CLEAN AIR NEWS

When there’s clean air news, NACAA reports on it here, homing in on key details and providing links to important related documents, materials and further information.

Administration Proposes Deep Cuts to Air Grants and EPA for FY 2019

February 12, 2018 – The Trump Administration has released its proposed FY 2019 budget, which includes steep decreases in EPA’s funding. The budget must now go to Congress for consideration. The Administration’s proposal calls for the following:

$152 million for state and local air grants under Sections 103 and 105 of the Clean Air Act, which is a decrease of 33 percent from the current amount of $227 million;

$6.1 billion for EPA in FY 2019, which is a decrease of $1.8 billion, or 23-percent, from the FY 2017 level (some comparisons are made to FY 2017 because FY 2018 is still under a Continuing Resolution and the final appropriations have not been made);

$10 million for grants under the Diesel Emissions Reduction Act (DERA), as compared to $30 million appropriated in FY 2017;

Transition of the PM2.5 monitoring program from Section 103 authority (which does not require matching grants) to Section 105 (which does require matching funds);

$27 million for Multipurpose Grants (“States would be able to spend this funding on any statutorily mandated delegated duty.”) There were no funds appropriated for this in FY 2017;

No funding for Targeted Airshed Grants, which received $20 million in FY 2017;

20.5-percent reduction in full-time EPA staff, from 15,416 to 12,250; and

Elimination of a list of programs, including the Climate Change Research and Partnership, Atmospheric Protection, Indoor Air, Radon, Pollution Prevention, Environmental Education and a list of geographic programs.

The Office of Management and Budget issued an addendum letter regarding additional funding that is available in FY 2019 due to the legislation that was adopted on February 9, 2018 that raises budget caps. However, the proposal does not call for any of the additional funding to be used for air-related activities. See EPA Budget in Brief, An American Budget, EPA Detailed Budget and FY 19 Addendum.

NACAA Comments on EPA Glider Repeal NPRM

January 5, 2018 – NACAA submitted written comments to the EPA docket on the agency’s November 16, 2017 Notice of Proposed Rulemaking (NPRM) to repeal the glider requirements adopted in October 2016 as part of the Phase 2 truck rule. In its letter, NACAA responds to EPA’s request in the NPRM for comments “on the relative expected emissions impacts if the regulatory requirements at issue here were to be repealed or were to be left on place.” NACAA highlights the specific estimated emission reductions to occur if the glider requirements remain intact and notes that “[e]very single state in the country will accrue more polluting emissions if these requirements are repealed.” The association further notes that those areas working to reduce emissions to attain and maintain health-based National Ambient Air Quality Standards may be forced to seek reductions elsewhere. This may mean more regulation and higher costs for stationary sources, possibly power plants, manufacturing facilities and small businesses, among others. In addition, in some areas, there are no alternatives for making up the lost reductions at any cost. NACAA also offers some technical observations on glider emissions testing cited by glider industry petitioners that requested that EPA reconsider the glider requirements and on EPA glider emissions testing results released in late November 2017. Further, In the NPRM, EPA proposes an interpretation of the Clean Air Act under which EPA would lack the authority to regulate gliders. NACAA does not comment on whether or not EPA has legal authority to regulate gliders but does note that “if EPA’s legal authority does not extend to the regulation of glider vehicles, glider engines and glider kits, then state and local agencies are not preempted from regulating them and may do so. Given the magnitude of emissions at stake states and localities may avail themselves of this authority if the federal glider requirements are repealed, potentially resulting in dozens, if not hundreds, of individual and varied state and local requirements.” EPA also seeks comment on whether, if the agency were to determine not to adopt the proposed interpretation of the Clean Air Act, EPA should revise the promulgated glider requirements to increase the exemption available for small manufacturers above the current limit of 300 glider vehicles a year and/or delay the deadline for compliance with the requirements. NACAA notes in its comments that any increase above the 300-glider-per-year limit, or any delay in implementation of the glider emission requirements, will result in an increase in NOx that many states and localities can ill afford.

NACAA Releases Permit Streamlining Principles and Recommendations

December 19, 2017 – NACAA sent a letter to EPA Assistant Administrator Bill Wehrum setting forth a series of principles and recommendations for EPA to consider as it undertakes initiatives to improve and streamline Clean Air Act permitting programs. The letter was developed based on the recommendations of the NACAA Permitting and New Source Review Committee and reflects members’ collective knowledge and experience as primary CAA permitting authorities. NACAA encourages EPA to think broadly about ways in which the permitting processes can be made more efficient, while continuing to build on the clean air gains of recent decades. The association presents three overarching principles that EPA should follow in any permit streamlining initiative: chief among them, that any reform or initiative must maintain or improve upon current levels of public health and environmental protection. NACAA also offers a series of more specific recommendations for the agency to consider as it develops its air permitting policy priorities. The recommendations cover a wide range of topics such as training, electronic permitting, regional consistency, availability of New Source Review offsets, the RACT-BACT-LAER Clearinghouse and flexible permitting.

NACAA Recommends Level Funding for Air Grants in FY 2018

December 5, 2017 – NACAA sent a letter to the Chairs and Ranking Members of the House and Senate Appropriations Committees reiterating the critical need for adequate grant funding in FY 2018 for state and local air pollution control agencies under Sections 103 and 105 of the Clean Air Act (CAA). In the letter, NACAA noted that the House bill for FY 2018 called for level funding for state and local air grants ($228.2 million), while the Senate’s recommendation called for an increase of $10 million. NACAA requested that “Congress, at a minimum, fund these grants at the FY 2017 level ($228.2 million) and notes that the Senate’s higher recommendation would make a particularly beneficial and important contribution to the health and vitality of America’s communities, businesses and environment.” Congress is currently working to develop an omnibus bill that will provide appropriations for the entire federal government for FY 2018. The current Continuing Resolution (CR) that has kept the government in operation since the start of the fiscal year on October 1, 2017 will expire on December 8, 2017. Congress is expected to adopt another CR to extend funding through December 22, 2017.

NACAA Testifies at EPA Hearing on Gliders

December 4, 2017 - NACAA Executive Director Miles Keogh presented NACAA’s testimony at EPA’s public hearing in Washington, DC on the agency’s proposal to repeal the glider requirements adopted in October 2016 as part of the Phase 2 truck rule. The testimony focused on EPA’s request in its NPRM for comments “on the relative expected emissions impacts if the regulatory requirements at issue here were to be repealed or were to be left on place.” In addition to highlighting the specific estimated substantial emission reductions to occur if the glider requirements remain intact, NACAA noted in its testimony that if the requirements are repealed, “those emissions will be allowed to go into the air to the detriment of clean air and public health across America.” The Association further noted that every state in the nation will experience more polluting emissions if the glider requirements are repealed and that those areas seeking to reduce emissions to attain and maintain health-based national ambient air quality standards may be forced to seek reductions elsewhere. This may mean more regulation and higher costs for stationary sources, possibly power plants, manufacturing facilities and small businesses, among others. In addition, in some areas, there are no alternatives for making up the lost reductions at any cost. Also testifying at the hearing were NACAA members Wayne Nastri, Executive Officer of the South Coast Air Quality Management District; Steve Cliff, Deputy Executive Officer of the California Air Resources Board; and Paul Farrell, Assistant Director of Air Planning for the Connecticut Department of Energy and Environmental Protection.

Congress to Consider Additional Continuing Resolution until December 22, 2017

December 4, 2017 - House Appropriations Chairman Rodney Frelinghuysen (R-NJ) has introduced a Continuing Resolution that will keep the federal government operating at FY 2017 levels until December 22, 2017. The federal government has been operating under a CR since the start of FY 2018 on October 1, 2017 because Congress has not yet adopted appropriations legislation. The current CR expires on December 8, 2017, so an additional measure is needed to avoid a government shutdown. Congress is expected to consider and approve this latest CR sometime this week. It has been reported that Congress may adopt a third CR before December 22, 2017 to extend funding until January 2018. The late December CR is expected to continue level funding for most government programs but to provide disaster relief for areas affected by recent hurricanes.

NACAA Comments on EPA Draft Strategic Plan

October 31, 2017 – NACAA has submitted comments on EPA’s “Draft FY 2018-2022 EPA Strategic Plan: Public Review Draft,” which was published in the Federal Register on October 5, 2017. EPA’s draft plan identifies the agency’s mission and goals for the next four years, which will be used as a management plan to guide the agency and track progress. In the comments, NACAA recommended that EPA call upon state and local air agencies for input during every phase of rule, policy and guidance development, including the initial stages, in order to benefit from their real-world experience. The association made specific comments on elements of the draft plan related to criteria pollutants, permitting, enforcement and training. Additionally, NACAA emphasized the need for adequate federal funding for state and local agencies, especially since EPA plans to enhance its reliance on state and local air quality programs through cooperative federalism. The draft strategic plan is available here. A one-page transformation strategy is available here. The Federal Register notice announcing the plan is available here.

NACAA Asks Senate Appropriators to Provide Level Funding for FY 2018

October 17, 2017 – NACAA sent a letter to Senators Thad Cochran and Patrick Leahy, Chairman and Vice Chairman of the Senate Appropriations Committee, respectively, requesting that Congress, at a minimum, continue to fund state and local air grants under Sections 103/105 at the same level as in FY 2017 ($228.2 million). The Senate Subcommittee on Interior, Environment, and Related Agencies will soon hold mark-up of the bill containing FY 2018 funding for EPA. The full Senate Appropriations Committee is expected to mark up the bill shortly thereafter. In the letter, NACAA emphasized the importance of adequate funding for state and local agencies to carry out their responsibilities under the Clean Air Act, protect public health and provide necessary services to the community. The House of Representatives, on September 14, 2017, adopted H.R. 3354, which called for level funding for state and local air grants in FY 2018. The federal government is operating under a Continuing Resolution (CR) that lasts until December 8, 2017, by which time Congress must adopt an appropriations bill for FY 2018, extend the CR or face a government shutdown.

Court Approves VW Trust Agreement

September 19, 2017 – The U.S. District Court of the Northern District of California, San Francisco Division approved the trust agreement for the Volkswagen (VW) Environmental Mitigation Trust and is sending it back to the parties (VW and California) for final signature. Once it has been signed (which must take place within approximately two weeks), it will be filed in court, thus establishing the Trust Effective Date (TED). The TED is the starting point for deadlines under the trust, including the provision that states have 60 days from the TED to apply for beneficiary status. The Environmental Mitigation Trust is the result of enforcement actions against automakers Volkswagen AG, Audi AG (a subsidiary of Volkswagen) and Volkswagen Group of America (collectively referred to as VW) for allegedly equipping approximately 500,000 light-duty diesel vehicles with 2.0-liter (2.0L) engines in the U.S., from model years (MY) 2009 through 2015, and approximately 80,000 3.0-liter engines from MY 2014-16 with software intended to impede, or “defeat,” emission control devices during normal driving situations. These devices are designed to sense when a vehicle is undergoing the Federal Test Procedure and, at that time, turn on full emission controls. The use of such “defeat devices” is illegal under the Clean Air Act. The results of these actions include consent decrees that, among other things, provide funds to states address the excess emissions of nitrogen oxides resulting from the violations. For further information: https://www.cand.uscourts.gov/crb/vwmdl and http://vwclearinghouse.org.

House Adopts FY 2018 Spending Bill Including EPA Funding

September 14, 2017 – The U.S. House of Representatives voted 211-198 to adopt H.R. 3354 – the Make America Secure and Prosperous Appropriations Act – which contains funding for the federal government for FY 2018. The omnibus bill combines appropriations provisions from 12 separate bills, including the legislation that funds EPA. While the House has completed its action, the Senate has not considered nor voted on appropriations legislation yet. Since it is virtually impossible for a Senate bill to be passed and the two bills to be reconciled by the end of the fiscal year on September 30, 2017, on September 8, 2017, Congress adopted H.R. 601 (now Public Law No. 115-56), which is a Continuing Resolution (CR) to provide continued funding for the federal government through December 8, 2017 and avoid a government shutdown. As previously reported, the House bill calls for level funding for state and local air grants ($228.2 million) and a 7-percent reduction in EPA’s overall budget. It would provide $75 million for grants under the Diesel Emission Reduction Act and $40 million for Targeted Airshed Grants and retain fine particulate monitoring grants under Section 103 authority. It includes several riders affecting the air program including postponement of the implementation of the 2015 ozone NAAQS (calling for designations to be submitted by 2024 and promulgated by 2025). During the debate on the House floor this week, several more amendments related to air quality were offered. One amendment, adopted by a vote of 225-186, prohibits EPA from using the social cost of carbon in rulemaking. The other, adopted by 218-195, prohibits funding for EPA to enforce the Obama Administration’s methane rule. An amendment to keep EPA from closing or consolidating regional offices failed by a vote of 201-212. For further information: https://www.congress.gov/bill/115th-congress/house-bill/3354

NACAA and NASEO Launch VW Settlement Clearinghouse

September 11, 2017 – NACAA and the National Association of State Energy Officials (NASEO) have jointly launched the NASEO & NACAA Volkswagen Settlement Clearinghouse, which is an online resource for state and local governments as they develop plans and implement projects under the Volkswagen (VW) settlement’s $2.9 billion Environmental Mitigation Trust. The clearinghouse can be accessed at http://vwclearinghouse.org/. The associations have sent out a press release announcing this new resource. The NASEO & NACAA VW Clearinghouse is a collaborative program of the two associations to support their state and local members as they consider and select eligible projects and investment strategies under the VW settlement. The Clearinghouse provides information, tools and resources to assist state and local agencies to develop strategies under the settlement that will reduce mobile source emissions; support the alternative fuels market; and further environmental, public health, economic development and energy goals. Because this information may be of value to others outside of the NASEO and NACAA memberships as well, the VW Clearinghouse will be publicly accessible. Please check out the website and keep in mind that NACAA and NASEO will continue to update and add to it.

NACAA Continues to Compile State/Local VW Repository

August 17, 2017 – NACAA is continuing to compile data in its repository for state and local agency information and links pertaining to the Volkswagen (VW) settlement and the Mitigation Trust Fund. The information accessible from the repository includes state and local agency webpages, public outreach materials, drafts of documents, etc. NACAA plans to update this repository as additional information becomes available. If you have information to share, please send the relevant documents, information and links to Mary Sullivan Douglas of NACAA at mdouglas@4cleanair.org. As part of the settlement between the United States government and VW over the company’s alleged use of “defeat devices” designed to cheat on federal emission tests for diesel cars, a Mitigation Trust Fund has been established. This trust will provide a specific level of funding to each state for eligible projects that will reduce nitrogen oxides. While the program is still being established and funds have not yet been distributed, state and local agencies have begun work on this effort, including developing beneficiary certification forms, drafting mitigation plans, establishing websites, reaching out to the public, etc. Since it may be useful for NACAA members and others to learn how state and local agencies are going about the tasks related to the VW Mitigation Trust Fund and what documents or resources others have developed, NACAA is compiling and sharing this information publicly.

NACAA Comments on EPA’s Draft NPM Guidance

August 2, 2017 – NACAA has submitted comments on EPA’s Draft FY 2018-2019 Office of Air and Radiation (OAR) National Program Manager Guidance (June 28, 2017) and the Draft National Program Manager (NPM) Guidance for FY 2018-2019 for the Office of Enforcement and Compliance Assurance (June 29, 2017). The draft guidance contains information on EPA’s priorities and activities (including state and local air grantees) for the next two fiscal years. NACAA expressed concern about the proposed cuts to state and local air grants contained in the Administration’s FY 2018 budget proposal and noted that such reductions could pose significant hardships on state and local agencies and their efforts to protect public health and welfare. NACAA emphasized the need for providing state and local agencies with additional resources or, at the very least, maintaining current funding levels. Additionally, NACAA provided specific comments on elements of the proposed document, including the fact that it does not provide details about EPA’s activities for the period covered by the guidance. Additional information about the draft guidance is available here.

EPA Publishes Proposed RFS Volume Requirements

July 21, 2017 – EPA published in the Federal Register (82 Fed. Reg. 34,206) proposed renewable fuel volume requirements under the Renewable Fuel Standard program for 2018 for total renewable fuel, advanced biofuel and cellulosic biofuel and for 2019 for biomass-based diesel. Under the proposal, 2018 total renewable fuel volumes would decline from 2017 levels to 19.24 billion gallons (from 19.28 billion gallons), advanced biofuel to 4.24 billion gallons (from 4.28 billion gallons) and conventional biofuels to 238 million gallons (from 311 million gallon). Biomass-based diesel in 2019 would remain level at 2.1 billion gallons. In a separate Federal Register notice published on July 18, 2017 (82 Fed. Reg. 32,783) the agency announced that it will hold a public hearing on the proposal on August 1, 2017 in Washington, DC. The public comment period on the proposal closes on August 31, 2017. EPA is required to finalize the renewable fuel volume requirements by November.

House Appropriations Committee Approves FY 2018 EPA Funding

July 18, 2017 – The House Appropriations Committee marked up and approved, by a vote of 30 to 21, a bill to provide funding for EPA in FY 2018. It is unknown when the bill will go before the full House for a vote. The House Appropriations Subcommittee on Interior, Environment, and Related Agencies approved the bill on July 12, 2017. Additionally, on July 17, 2017 the Committee released the draft committee report on the legislation, which provides additional details and instructions related to FY 2018 funding. The Committee-approved bill provides level funding (compared to the FY 2017 enacted level) – $228.2 million – for state and local air grants under Sections 103 and 105 of the Clean Air Act (the Administration requested $159.5 3 million for FY 2018). The bill includes $7.5 billion in FY 2018 for EPA’s overall budget (the Administration requested $5.7 billion; the FY 2017 appropriation was $8.1 billion). The bill calls for retaining funding for fine particulate matter monitoring under Section 103 authority, rather than transitioning to Section 105 authority as EPA proposed, includes $75 million for grants under the Diesel Emissions Reduction Act (DERA) program and provides $40 million for the Targeted Airshed Grant program. Among the riders to the bill is a postponement of the implementation of the 2015 ozone National Ambient Air Quality Standards (NAAQS) such that governors would submit their designations by October 26, 2024, EPA would promulgate final designations by October 26, 2025 and states would submit their State Implementation Plans under Section 110(a)(1) by October 26, 2026. Further, the rider would exempt permitted sources from the 2015 ozone NAAQS under certain circumstances, instead allowing them to comply with the previous, less stringent ozone standard. During the full committee mark-up, several amendments related to air quality were offered. Rep. Betty McCollum (DMN) offered an amendment that would remove several air quality-related riders from the bill (e.g., the extended schedule for implementation of the ozone NAAQS, restrictions on greenhouse gas reporting), but it was not adopted. Rep. Mike Quigley (D-IL) offered an amendment intended to ensure that the 10 EPA Regional Offices would remain open. This failed, with opponents arguing that recent testimony from EPA Administrator Scott Pruitt implied that this was not a concern and that Congress would have the ultimate say in any such decisions through the appropriations process. Rep. Matt Cartwright (D-PA) proposed report language requiring agencies to prepare for and mitigate the effects of climate change. This amendment also failed. The report and bill text address several airrelated provisions, including the following: grant allocation (page 53 of the report states, “Further, if EPA is proposing to change State allocation formulas for the distribution of appropriated funds, then EPA should include such proposals in the Congressional justification”); ozone provisions (page 136 of the bill); Energy Star and permit effectiveness funding (page 56 of the report); geographic programs (page 57 of the report for the narrative and page 155 for a chart); DERA and Targeted Airshed Grants (page 65 of the report for the narrative and page 159 for the chart); and State and Local Air Grants (page 160 of the report for the chart). Please see: https://appropriations.house.gov/uploadedfiles/23918.pdf (EPA section begins on page 52 and the EPA charts begin on page 153), https://appropriations.house.gov/uploadedfiles/fy18_interior_xml.pdf and http://www.4cleanair.org/sites/default/files/Documents/EPA_Memo_on_House_Ap p_Mark-up-2017-07-19.pdf.

House Approves Ozone Bill

July 18, 2017 – The U.S. House of Representatives approved, by a vote of 229 to 199, H.R. 806, the Ozone Standards Implementation Act of 2017. The bill, introduced on February 1, 2017 by Rep. Pete Olson (R-TX), has as its stated purpose “[t]o facilitate efficient State implementation of ground-level ozone standards, and for other purposes.” Among the provisions of the bill are ones to phase in implementation of the 2008 and 2015 ozone National Ambient Air Quality Standards (NAAQS) and delay final designations under the 2015 standard until 2025; extend the timeframe for reviewing the NAAQS for any criteria pollutant from every five years to every 10 years; authorize the EPA Administrator to consider technological feasibility as a “secondary consideration” when revising a NAAQS; and allow, until 2025, permits for new and modified industrial facilities to be processed under the less-stringent 2008 ozone NAAQS. Other provisions of the bill would ensure that for certain ozone and PM nonattainment areas states would not be required to include in their State Implementation Plans measures that are economically infeasible; amend the exclusions from the term “exceptional event” by changing “stagnation of air masses” to “ordinarily occurring stagnation of air masses” and eliminating “a meteorological event involving high temperatures or lack of precipitation”; eliminate the requirement for contingency measures in Extreme ozone nonattainment areas; require EPA to submit two reports to Congress – on the impact of foreign sources of pollution on NAAQS compliance and on ozone formation and effective control strategies; and limit the applicability of certain sanctions and fees in some ozone and PM nonattainment areas if the state demonstrates nonattainment would have been avoided, or attainment achieved, but for emissions that are beyond the state’s control. Democrats offered six amendments during floor debate: 1) to halt implementation of the Act if the Clean Air Scientific Advisory Committee finds that implementation could increase health risks to vulnerable populations, 2) to strike provisions to allow EPA to consider technological feasibility when setting NAAQS, 3) to strike changes to existing exceptional events requirements, 4) to close a “loophole” that prevents aggregating emissions from any oil or gas exploration or production well and to require EPA to add hydrogen sulfide to the list of hazardous air pollutants, 5) to strike provisions barring the appropriation of additional funds to carry out the requirements of the Act and 6) to strike the underlying bill and replace it with a grant program to benefit regions with the poorest air quality. All six amendments failed. Late last week, the Congressional Budget Office (CBO) issued an estimate of the cost to implement H.R. 806, based on information from EPA. CBO has estimated that completing the activities in the bill over the period of 2018 to 2020 would cost $2 million. Attention now turns to the Senate where S. 263 – a companion to H.R. 806, introduced on February 1, 2017 by Senator Shelley Moore Capito (R-WV) – is awaiting further action by the Environment and Public Works Subcommittee on Clean Air and Nuclear Safety. The Subcommittee held a hearing on S. 263 on May 23, 2017, entitled “Making Implementation of the National Ambient Air Quality Standards for Ground-Level Ozone Attainable.”

Miles Keogh Named New Executive Director of NACAA

July 17, 2017 – The NACAA Board of Directors announced that Miles Keogh has been selected as the new Executive Director of the association. Miles will assume his new role on August 7, succeeding outgoing Executive Director Bill Becker. Miles comes to NACAA from the National Association of Regulatory Utility Commissioners (NARUC), where he served as Director of the NARUC Research Lab, advising State Commissions on energy, environmental, and security issues. He was instrumental in facilitating years of collaborative work between NACAA and NARUC members through the “3N” process, organized NARUC’s Recovery Act programs, and led a number of efforts to better integrate energy, utility, and clean air decision-making. Prior to joining NARUC in 2005, Miles worked in the energy industry, spent several years at an energy policy think tank, and performed environmental permitting for new energy infrastructure for the Massachusetts Commission. “I am grateful for this opportunity to join the NACAA family,” said Miles. “We face a great opportunity to be of service to our member agencies and to provide dynamic leadership advocating for smart policies that lead to clean air and better public health. I’m looking forward to building on the vision and teamwork of the national organization.”

EPA Proposes to Retain Current NO2 NAAQS

July 14, 2017 – Based on its review of the current body of scientific evidence, EPA is proposing to retain the current primary National Ambient Air Quality Standards (NAAQS) for oxides of nitrogen without revision. The proposal is consistent with the recommendation of the Clean Air Scientific Advisory Committee, EPA’s independent scientific advisors, which provided its advice to the EPA Administrator earlier this year. There are currently two nitrogen dioxide (NO2) standards: 1) a 1-hour standard, established in 2010, at a level of 100 parts per billion (ppb) and based on the 98th percentile of the annual distribution of daily maximum 1-hour NO2 concentrations, averaged over three years and 2) an annual standard at a level of 53 ppb, originally established in 1971. EPA last reviewed the NO2 standards in 2010. The schedule for the current review was set by a court order that requires a signed proposed determination by July 14, 2017 and a final determination by April 6, 2018. The proposal to retain the current standards was signed by the EPA Administrator on July 14 and will be subject to a 60-day public comment period upon publication in the Federal Register.

States Move to Defend 2015 O3 NAAQS

July 6, 2017 – Seven states and the District of Columbia (collectively, the state movants) filed a motion in the U.S. Court of Appeals for the District of Columbia Circuit seeking to intervene in litigation challenging the National Ambient Air Quality Standards for ozone promulgated by EPA in 2015 (Case No. 15-1385, Murray Energy Corporation v. EPA). All but one of the state movants previously filed an amicus brief in this case but now seek to change their party status to intervenor “[b]ecause of recent, concrete indications from EPA in a June 6, 2017 letter [to governors] and a June 28, 2017 Federal Register notice that it will no longer vigorously defend the 2015 Ozone NAAQS.” The state movants go on to say that before these recent statements, EPA’s positions before the court were consistent with their interests and intervention was not necessary. However, they say, “EPA’s recent official statements…signal its agreement with arguments advanced by the Industry and State Petitioners who seek to weaken the rule, contradict EPA’s own briefing to this Court, and are contrary to the positions State Movants took in their amicus brief” thus constituting good cause for the court to grant the State Movants intervenor status at this time. In addition to DC, parties to this motion include California, Delaware, Massachusetts, New York, Rhode Island, Vermont and Washington.

EPA Proposes RFS Volume Requirements

July 5, 2017 – EPA posted on its website proposed renewable fuel volume requirements under the Renewable Fuel Standard program for 2018 for total renewable fuel, advanced biofuel and cellulosic biofuel and for 2019 for biomass-based diesel. Under the proposal, 2018 total renewable fuel volumes would decline from 2017 levels to 19.24 billion gallons (from 19.28 billion gallons), advanced biofuel to 4.24 billion gallons (from 4.28 billion gallons) and conventional biofuels to 238 million gallons (from 311 million gallon). Biomass-based diesel in 2019 would remain level at 2.1 billion gallons. Once the proposal is published in the Federal Register EPA will accept comments for 45 days. The agency will also hold a public hearing, to be announced once the proposal is published. EPA is required to finalize the renewable fuel volume requirements by November.

EPA Publishes Notice Extending O3 Designations

June 28, 2017 – EPA published in the Federal Register (82 Fed. Reg. 29,246) a notice extending, until October 1, 2018, the deadline for promulgating initial area designations under the National Ambient Air Quality Standards (NAAQS) for ozone established in 2015. This notice formalizes EPA Administrator Scott Pruitt’s June 6, 2017 announcement – via a letter to governors – of his intention to take such action. The Administrator has cited his authority under Clean Air Act Section 107(d)(1)(B)(i) to delay promulgation of initial area designations for one year “in the event the Administrator has insufficient information to promulgate the designations.” In the Federal Register notice, EPA states: “Following the recent change in administrations, the agency is evaluating a host of complex issues regarding the 2015 ozone NAAQS and its implementation, such as understanding the role of background ozone levels and appropriately accounting for international transport. The Administrator has determined that he cannot assess whether he has the necessary information to finalize designations until additional analyses from this evaluation are available. In addition, pursuant to language in the recently-enacted Fiscal Year 2017 omnibus bill, the Administrator is establishing an Ozone Cooperative Compliance Task Force to develop additional flexibilities that could impact the designation process. In light of the analyses currently underway at the agency, the Administrator has determined he needs additional time to consider completely all designation recommendations provided by state governors pursuant to CAA section 107(d)(1)(A), including full consideration of exceptional events impacting designations, and determine whether they provide sufficient information to finalize designations. We also note that new agency officials are currently reviewing the 2015 ozone NAAQS rule. The Administrator has determined that in light of the uncertainty of the outcome of that review, there is insufficient information to promulgate the designations by October 1, 2017.”

House Energy and Commerce Committee Approves Ozone Bill

June 28, 2017 – The House Energy and Commerce Committee marked up and approved – by a vote of 29 to 24 – H.R. 806, the Ozone Standards Implementation Act of 2017, introduced by Rep. Pete Olson (R-TX) on February 1, 2017. Among the provisions of the bill are ones to phase in implementation of the 2008 and 2015 ozone National Ambient Air Quality Standards (NAAQS) and delay final designations under the 2015 standard until 2025; extend the timeframe for reviewing the NAAQS for any criteria pollutant from every five years to every 10 years; authorize the EPA Administrator to consider technological feasibility as a “secondary consideration” when revising a NAAQS; and allow, until 2025, permits for new and modified industrial facilities to be processed under the less-stringent 2008 ozone NAAQS. It is expected that H.R. 806 will go to the full House for a vote before the August recess, although floor time has not yet been scheduled.

Senators Introduce DERA Reauthorization Bill

June 27, 2017 – Senator Tom Carper (D-DE), Ranking Member of the Senate Environment and Public Works (EPW) Committee, joined by EPW Committee Chairman John Barrasso (R-WY) and Senators James Inhofe (R-OK) and Sheldon Whitehouse (D-RI), introduced S. 1447, the Diesel Emissions Reduction Act (DERA) of 2017. The bill would reauthorize the successful DERA program – first established in the Energy Policy Act of 2005 – for another five years, 2018 through 2022, with a recommended annual funding level of $100 million. The sponsors have also proposed in the bill several changes to the DERA program including requiring the recognition of “differences in typical vehicle, engine, equipment, and fleet use throughout the United States.”

EPA Administrator Extends Designations Under 2015 Ozone NAAQS by One Year

June 6, 2017 – EPA Administrator Scott Pruitt sent a letter to governors informing them that he is extending, by one year (until October 1, 2018), the deadline for promulgating initial area designations under the 2015 National Ambient Air Quality Standards (NAAQS) for ozone. Pruitt says in the letter that he is taking this action under Section 107(d)(1)(B) of the Clean Air Act, which requires the EPA Administrator to promulgate area designations “as expeditiously as practicable, but in no case later than 2 years from the promulgation of the new or revised national ambient air quality standard,” but provides for an extension of up to one year “in the event the Administrator has insufficient information to promulgate the designations.” Indicating that he has determined that there is insufficient information Pruitt writes that additional time is appropriate to allow for complete consideration of all area designation recommendations made by governors and to rely fully on the most recent air quality data. The Administrator further states, “This additional time will also provide the Agency time to complete its review of the 2015 ozone NAAQS, prior to taking this initial implementation step.” In addition, Pruitt cites “a host of complex issues that could undermine associated compliance efforts by states, localities and regulated entities,” noting that as part of its review process EPA is focusing, in particular, on background ozone levels, international transport and exceptional events demonstrations. Pruitt also advises the governors that he has established an Ozone Cooperative Compliance Task Force “to develop additional flexibilities for states to comply with the ozone standard.” The Administrator sums up his intention by saying, “Despite the continued improvement in air quality, costs associated with compliance of the ozone NAAQS have significantly increased. I am committed to working with you and your local officials to effectively implement the ozone standard in a manner that is supportive of your air quality improvement efforts, without interfering with local decisions or impeding economic growth.”

NACAA Submits Testimony on FY 2018 Budget

May 25, 2017 – NACAA has submitted testimony to the House and Senate Appropriations Subcommittees on Interior, Environment, and Related Agencies expressing opposition to the Administration’s proposed FY 2018 budget cuts in grants to state and local air pollution control agencies under Sections 103 and 105 of the Clean Air Act. The proposed budget called for, among other things, a 30-percent reduction in state and local air grants (from $227.8 million in FY 2017 to $159.5 million in FY 2018). NACAA requested that Congress, at a minimum, continue to fund state and local air grants at least year’s level. NACAA reported that state and local air agencies would have difficulty accommodating any cuts, especially of the magnitude being proposed. The reductions would impede their ability to continue essential programs, some of which would have to be reduced or eliminated. The testimony reported on the responses to NACAA’s recent survey of its membership (see related article) and described some of the adverse impacts that individual agencies could expect to see if the grant reductions are enacted. NACAA also requested that grant funds for fine particulate matter monitoring remain under Section 103 authority, where matching funds are not required, rather than being shifted to Section 105 authority.

Administration Proposes Steep EPA Budget Cuts

May 23, 2017 – President Trump released the FY 2018 budget request for the federal government, including EPA, calling for a 30-percent cut in federal grants to state and local air pollution control agencies under Sections 103 and 105 of the Clean Air Act – from $227.785 million in FY 2017 to $159.450 million in FY 2018. The budget would reduce EPA’s total budget by 31 percent (from $8.2 billion in FY 2017 to $5.7 billion in FY 2018) and would decrease EPA’s staffing levels by 25 percent (from 15,416 full-time equivalents to 11,611). The proposal also includes reduction of the Diesel Emission Reduction Act (DERA) grants by 80 percent (from $50 million in FY 2017 to $10 million in FY 2018); elimination of the Targeted Airshed grant program ($20 million in FY 2017) and the Multipurpose Grant program ($21 million in FY 2017); elimination of funding for a dozen geographic programs including those for the Chesapeake Bay, Great Lakes and Puget Sound; reduction of EPA’s Science and Technology Budget by 39 percent (from $733 million to $451 million) and a decrease in EPA’s Environmental Program and Management budget (i.e., the agency’s overall operating budget) by 35 percent (from $2.6 billion to $1.7 billion). The budget will now be sent to Congress for consideration and enactment of appropriations legislation. Budget details are available on several webpages: EPA’s Budget in Brief, EPA excerpt from the full budget and the White House’s FY 2018 budget website.

NACAA Reports on Impacts of Proposed Grant Cuts

May 22, 2017 – NACAA has prepared a report describing the likely adverse impacts on state and local air quality programs of the Administration’s proposed reductions of 30 percent in FY 2018 federal grants to those agencies. The report, which is based on a survey of NACAA members, is entitled, Impacts of Proposed FY 2018 Budget Cuts on State and Local Air Quality Agencies. The survey asked agencies about the possible impact of 30-percent reductions to state and local air agency grants under Sections 103 and 105 of the Clean Air Act, as well as how they have adjusted to shrinking resources in recent years. The survey also asked about the prospect of state and local governments providing additional resources and whether agencies are likely to return programs to EPA if funding is cut. The report reflects input from 31 state and local air quality agencies and presents a dismal picture of the effects of such cuts, with agencies outlining the devastating impact on their efforts to provide healthful air quality for the American public. Respondents indicated that their programs could face severe curtailments, including loss of staff, cancellation of activities and a diminished capacity to obtain and maintain healthful air quality, among other things. Most noted that additional state and local resources to fill in the gaps are highly unlikely and that returning program elements to EPA would be very possible if faced with severe budget cuts. The report includes summaries of the responses, as well as direct quotes from many of the agencies describing the likely effects of the budget cuts. The Administration is planning to release its FY 2018 budget request on May 23, 2017 calling for, among other things, a 30-percent reduction in state and local air pollution control agency grants under Sections 103 and 105 of the Clean Air Act and a 31-percent reduction in EPA’s overall budget. The budget will also call for a 39-percent cut in EPA’s Science and Technology budget, a 35-percent cut in EPA’s Environmental Program and Management budget (i.e., the agency’s overall operating budget) and the elimination of funding for a dozen geographic programs including those for the Chesapeake Bay, Great Lakes and Puget Sound. The President also seeks to cut the Diesel Emission Reduction Grant Program by 80 percent, from $49.9 million in FY 2017 to $10 million in FY 2018, and to zero out Targeted Airshed Grants. Information about the budget is available here.

President to Propose 30% Cuts to State/Local Air Grants

May 19, 2017 – A document prepared by the Administration shows that the Fiscal Year (FY) 2018 budget request President Trump is expected to release on Tuesday, May 23, 2017, will include a 30-percent cut in federal grants to state and local air pollution control agencies under sections 103 and 105 of the Clean Air Act – from $227.785 million in FY 2017 to $159.450 million in FY 2018. NACAA has published a set of tables that contain information taken directly from an Administration document detailing the FY 2018 budget request for EPA. Other notable components of the anticipated budget request are a 31-percent cut in EPA’s overall budget, a 39-percent cut in EPA’s Science and Technology budget, a 35-percent cut in EPA’s Environmental Program and Management budget (i.e., the agency’s overall operating budget) and the elimination of funding for a dozen geographic programs including those for the Chesapeake Bay, Great Lakes and Puget Sound. The President also seeks to cut the Diesel Emission Reduction Grant Program by 80 percent, from $49.9 million in FY 2017 to $10 million in FY 2018, and to zero out Targeted Airshed Grants.

May 17, 2017 – The Senate Homeland Security and Governmental Affairs Committee approved five regulatory reform bills clearing the way for the bills to be considered by the full Senate. S. 951, the Regulatory Accountability Act, requires, among other things, that federal agencies consider reasonable alternatives to the most expensive rules, with three alternatives presumed to be a reasonable number for consideration, and to select the most cost-effective rule unless the agency provides a detailed explanation of why it selected a less cost-effective rule. This Committee approved this bill by a vote of nine to five. A different version of the Regulatory Accountability Act (H.R. 5) has already passed the House. S. 21, the REINS Act, which requires Congressional approval of major rules, passed by a party-line vote of eight to six. The House companion to the REINS Act (H.R. 26) was passed in January. S. 34, the Midnight Rules Relief Act, would amend the Congressional Review Act to allow Congress, through a joint resolution of disapproval, to overturn multiple “midnight rules” – those promulgated in the final days of a Presidential administration – at once. Under the amended law, the new President must sign off on any such joint resolution of disapproval; if s/he vetoes a resolution, Congress could override the veto with a two-thirds vote by the House and Senate. This bill also passed along party lines by a vote of eight to six. The House version of this bill, H.R. 21, was passed in January. Also passed along party lines (eight to six) was S. 584, the Small Business Regulatory Flexibility Improvements Act, which requires federal agencies to analyze indirect economic effects of proposed rules on small businesses even if the business is not directly regulated by the rule. The House has not taken action on its companion to this bill, H.R. 33, but did approve the provisions of it as part of H.R. 5 (the Regulatory Accountability Act). Finally, S. 579, the Early Participation in Regulations Act, which would amend the Administrative Procedure Act to impose a mandate requiring all agencies to conduct an Advance Notice of Proposed Rulemaking, including specified analyses, for all pending major rules, passed by a vote of 11 to three.

Court Approves VW Settlement with Additional Funds for States

May 17, 2017 – The U.S. District Court for the Northern District of California, San Francisco Division, has approved a settlement among automakers Volkswagen AG, Audi AG, Porsche AG and related entities (VW), the U.S. Department of Justice, EPA and the California Air Resources Board to address the automaker’s sale of 83,000 3.0-liter diesel cars for model years 2009-2016 with illegal emission control defeat devices. The settlement, proposed on December 20, 2016, is separate from an earlier and larger partial agreement pertaining to 2.0-liter vehicles. The 3.0-liter vehicle settlement calls for VW to buy back or terminate leases or offer emissions modifications, of they are approved. As part of the settlement, VW will provide $225 million to fund projects that will mitigate the past and future emissions of nitrogen oxides (NOx) resulting from the affected vehicles. This is in addition to the $2.7 billion that VW has placed into a mitigation trust fund as a result of the settlement on the 2.0-liter vehicles. The additional funds will be placed into the same mitigation trust fund as the proceeds from the settlement from the 2.0-liter vehicles, with all states, Puerto Rico, the District of Columbia and tribes eligible for specified amounts (listed in the settlement). The funds are expected to be used for the same types of projects identified as eligible for funding under the 2.0-liter vehicle settlement.

Study Links Diesel NOx Emissions to More than 107,000 Deaths in 2015, Excess Emissions Responsible for over One-Third

May 15, 2017 – A study published in Nature concludes not only that nitrogen oxide (NOx) emissions from diesel cars, trucks and buses were linked to 107,600 premature deaths around the world in 2015 but also that more than one-third of those deaths, about 38,000 (1,100 of which were in the U.S.), were due to excess NOx emissions – those that occur during normal, real-world vehicle operation in amounts exceeding regulatory limits. The study is based on an examination of 11 major vehicle markets – Australia, Brazil, Canada, China, the European Union, India, Japan, Mexico, Russia, South Korea and the U.S. – that, together, accounted for over 80 percent of new diesel vehicle sales in 2015 and nearly 60 percent, about 13.1 million metric tons, of worldwide diesel NOx emissions. Of those 13.1 million metric tons of NOx emissions, about 4.6 million were excess emissions. The researchers concluded that unless more effective action is taken to control diesel NOx emissions the number of related premature deaths will rise from 107,600 in 2015 to 183,600 in 2040. They also determined that more stringent diesel tailpipe emission standards along with effective compliance and enforcement programs could prevent 174,000 premature deaths a year by 2040. Research for Impacts and Mitigation of Excess Diesel NOx Emissions in 11 Major Vehicle Markets was led by the International Council on Clean Transportation and Environmental Health Analytics in collaboration with the University of Colorado, Stockholm Environment Institute and International Institute for Applied Systems Analysis.

Congress Adopts FY 2017 Appropriations Bill

May 4, 2017 – Congress has adopted H.R. 244, the 2017 Consolidated Omnibus Appropriations Bill, which funds the federal government for the remainder of FY 2017 (ending September 30, 2017). The House adopted the bill on May 3, 2017 by a vote of 319-118 and the Senate adopted it on May 4, 2017 by a vote of 79-18. The President is expected to sign it before the short-term Continuing Resolution adopted last week expires on May 5, 2017. The provisions in the appropriations bill include the following, among others (the information regarding page numbers refers to the documents linked below): EPA’s budget is set at $8.06 billion, as compared to $8.14 billion in FY 2016 (page 36 of report); state and local air grants under Sections 103 and 105 will be $228.2 million, which is equal to FY 2016 levels (page 44 of report); State and Tribal Assistance Grants will undergo a rescission of $61 million (the details about how the cuts will be distributed among the media grants are not yet available) (page 45 of report); EPA is directed to allocate state and local air grants using the same formula as in FY 2015 and to provide some additional funds to the regions with the highest need (page 44 of report); Targeted Airshed grants will be $30 million, as compared to $20 million in FY 2016 (page 43 of report and page 838 of bill); Multipurpose grants will be eliminated, as compared to $21 million in FY 2016 (page 100 of report); PM2.5 monitoring grants will remain under Section 103 authority instead of being shifted to Section 105, which requires matching funds (page 839 of bill); Diesel Emission Reduction Act grants will be $60 million, as compared to $50 million in FY 2016 (page 838 of bill); EPA’s workforce will be held at its current level of 15,000 positions, which is below FY 2016 levels (page 36 of report); EPA must provide a report within 90 days examining the possibility of allowing states to receive regulatory relief with respect to the “burden of implementing…potentially overlapping” National Ambient Air Quality Standards for ozone that were set in 2008 and 2015; and EPA and the Departments of Energy and Agriculture are directed to establish policies that “reflect the carbon-neutrality of forest bioenergy and recognize biomass as a renewable energy source…” (page 901 of bill). For bill language, click here (EPA section begins on page 824). For report language, click here (EPA section begins on page 36 and charts begin on page 93).

NACAA Joins Broad Coalition in Urging House Members to Reauthorize DERA

May 3, 2017 – NACAA, as part of a coalition that also includes industry groups, environmental and public health organizations and other stakeholders, signed a letter that was sent to members of the House of Representatives urging them to support reauthorization of the Diesel Emissions Reduction Act (DERA). In the letter, the coalition highlights the cost effectiveness of the DERA program, noting EPA’s estimates that every $1 in federal assistance is met with another $3 in non-federal matching funds and generates $5 to $21 in health and economic benefits. As indicated in the letter, EPA also estimates that the DERA program has resulted in the upgrading of nearly 73,000 vehicles or pieces of equipment for total lifetime emissions reductions of 335,200 tons of nitrogen oxide and 14,700 tons of particulate matter, which equate to approximately $12.6 billion in health benefits. The coalition also explains that every state benefits from DERA, with 30 percent of funding dedicated to supporting state programs. The most recent reauthorization of DERA occurred in 2010, when legislation was enacted to authorize funding for the program from 2012 through 2016. Among the other 3 groups signing the letter are the American Association of Port Authorities, American Lung Association, American Trucking Associations, Associated General Contractors of America, Clean Air Task Force, Corning Incorporated, Cummins Inc., Diesel Technology Forum, Emissions Control Technology Association, EDF Action, Manufacturers of Emission Controls Association, National Association of State Directors of Pupil Transportation Services, National School Transportation Association, South Coast Air Quality Management District and the Truck and Engine Manufacturers Association.

NACAA and Tribal Organizations Call for Adequate Funding

April 24, 2017 – NACAA sent a joint letter with the National Tribal Air Association, the Tribal Air Monitoring Support Center’s Steering Committee and the EPA’s National Tribal Caucus to EPA Administrator Scott Pruitt to emphasize the critical importance of continued federal funding for the activities that federal, state, local and Tribal air agencies carry out. The letter notes that federal grants support many critical state, local and Tribal programs that are essential to attaining and maintaining healthful air quality. Many of these activities are resource intensive and it is imperative that funding from EPA be continued at a level that keeps these programs in full operation. Additionally, the groups called upon EPA to support the sovereignty and self-determination of states, local governments and Tribes through “proactive engagement in government-to-government consultation” and the development and implementation of air quality programs that respond to the input EPA receives from States, Local agencies, and Tribes.”

EPA Proposes 30-Percent Cut in Air Grants for FY 18

April 3, 2017 – An EPA memorandum (dated March 21, 2017) providing information about the Administration’s upcoming FY 2018 budget proposal has become public, providing specific details that have heretofore been unavailable about the implications of the Administration’s “Budget Blueprint” released on March 16, 2017. The latest information indicates that air grants (under Sections 103/105 of the Clean Air Act) would be reduced by 31 percent from FY 2016 levels (FY 2017 levels are currently very similar to FY 2016 levels, due to the Continuing Resolution under which the federal government is operating). This means that grants would go from $228.2 million in FY 2016 to $159.5 million in FY 2018. Previous information indicated cuts of 45 percent were being proposed for categorical grants (e.g., air, water, solid waste grants), but did not break down the information by media. This provides greater specificity related to individual media grants, including air. With respect to EPA’s overall budget, the agency would experience a 31-percent reduction in funding, to $5.7 billion, and a reduction of 24.9 percent in staffing levels, for a total of 11,548 full-time equivalents. Under the proposal, the Diesel Emission Reduction Act (DERA) grants would be reduced from $50 million in FY 2016 to $15 million, the Targeted Airshed grants would be eliminated ($20 million in FY 2016) and the Multipurpose Grants would be eliminated ($21 million in FY 2016). The figures in the memorandum differ in certain respects from preliminary data NACAA had obtained from an Office of Management and Budget document on February 28, 2017).

Administration Proposes Cuts to Grants for FY 2017

March 28, 2017 - The Administration reportedly is proposing cuts to EPA’s budget for FY 2017, including a 10.6-percent reduction in categorical grants, which is the funding category that includes Sections 103 and 105 grants for state and local air agencies. According to a spreadsheet that is being circulated, categorical grants would be cut from $1.079 billion to $964 million for FY 2017. The $115-million reduction would have to be absorbed in the six months remaining in the fiscal year (which ends September 30, 2017). The information does not indicate if the cuts would affect all the media grant programs equally or if some would be reduced more than others. With respect to the proposed reduction to categorical grants, the document states: “These grants fund state environmental programs and offices, which are being significantly scaled back in the FY 2018 proposal. This smaller cut eases into that transition by reducing most grants by -10%, compared to a -44% reduction in the FY 2018 Blueprint.” In addition to categorical grants, the proposed FY 2017 budget calls for reductions to research and development (including climate-related research), brownfield grants, the Great Lakes Restoration Initiative and Superfund. This document reflects an Administration proposal. Congress must adopt appropriations legislation to fund the government. Congress has not yet adopted final appropriations bills for FY 2017, which began on October 1, 2016. Currently the government is operating under a Continuing Resolution that expires on April 28, 2017. Congress must take steps to provide for federal funding after April 28, 2017, such as individual appropriations bills, an omnibus bill that rolls all federal funding into one bill or another CR that continues to extend federal funding at FY 2016 levels.

President Signs Executive Order to Reevaluate Clean Power Plan

March 28, 2017 -President Trump signed an executive order to reevaluate the Obama Administration’s Clean Power Plan (CPP) rule and eliminate other federal initiatives designed to address climate change. Flanked by EPA Administrator Scott Pruitt, Secretary of the Interior Ryan Zinke, Energy Secretary Rick Perry, and Vice President Mike Pence, the President unveiled the executive order during a press event at EPA headquarters in Washington, DC. “My administration is putting an end to the war on coal. We're going to have clean coal -- really clean coal. With today’s executive action, I am taking historic steps to lift the restrictions on American energy, to reverse government intrusion, and to cancel job-killing regulations,” Trump said. Among the order’s many provisions, it targets Obama Administration limits on carbon dioxide emissions from power plants, instructing EPA to reevaluate the CPP and new source performance standards for oil and natural gas-fired power plants. The order further authorizes the Department of Justice to request, as appropriate, that the U.S. Court of Appeals for the District of Columbia Circuit suspend legal challenges to both rules as EPA takes action to withdraw or revise them. EPA’s methane regulations for new sources in the oil and gas sector, finalized in June 2016, are also targeted for a rewrite or withdrawal by the order. Additional sections of the order address policies finalized by the Department of the Interior. It immediately lifts a moratorium on new coal mine leases on federal lands and targets for review and possible withdrawal rules that regulate hydraulic fracturing, govern oil and gas rights and reduce waste from extraction activities. The order includes broad directives to change how federal agencies account for climate change in their decision-making process by prohibiting federal regulators from using the social cost of carbon and other greenhouse gasses (GHGs) to assess the benefits of future regulations and disbanding the Interagency Working Group used to develop previous social cost assessments. It immediately rescinds the 2016 guidance incorporating GHG impacts into National Environmental Policy Act reviews. Further, the order directs all federal agencies to examine their existing policies and suspend, revise or rescind any that interfere with domestic energy production. The order, however, does not address EPA’s 2009 finding that greenhouse gasses endanger public health and welfare, nor does it address the U.S. commitment to and participation in the Paris Agreement.

NACAA Expresses Concern About Budget Cuts

March 27, 2017 – NACAA has sent a letter to the House and Senate leadership of the Appropriations Subcommittees on Interior, Environment, and Related Agencies expressing the association’s deep concern about the significant reductions to the FY 2018 budget for EPA that are proposed in the Administration’s Budget Blueprint that was released on March 16, 2017. The letter notes that the possible reductions of 45 percent to state and local air grants under Sections 103 and 105 of the Clean Air Act would be devastating to state and local air quality programs. State and local air quality agencies already struggle with insufficient resources and increased responsibilities. They rely on federal grants for a host of critical programs. Any cuts to those grants would be hard to accommodate, but the steep proposed cuts in the Budget Blueprint could result in significant adverse impacts to their programs and to public health and the environment. Additionally, NACAA’s letter discussed the fact that state and local agencies must rely on EPA to carry out its responsibilities in assisting state and local air programs. Therefore, it is vitally important that EPA be adequately funded as well. NACAA sent the letter to Senators Lisa Murkowski (R-AK) and Tom Udall (D-NM), Chair and Ranking Member, respectively, of the Senate Appropriations Committee on Interior, Environment, and Related Agencies and Reps. Ken Calvert (R-CA) and Betty McCollum (D-MN), Chair and Ranking Member, respectively, of the House Appropriations Committee on Interior, Environment, and Related Agencies.

Former EPA Officials Analyze Impacts of Budget Cuts

March 22, 2017 – A newly formed bipartisan group of 75 former employees of EPA and related federal and state agencies has completed an analysis of the impacts of the Administration’s proposed budget for FY 2018, concluding that “[t]he Trump Budget Blueprint for EPA appears to be nothing less than a full-throttle attack on the principle underlying all U.S. environmental laws – that protecting the health and environment of all Americans is a national priority.” The group – the “Environmental Protection Network” – based its analysis on the Administration’s Budget Blueprint (March 16, 2017) and information contained in the Office of Management and Budget (OMB) “passback” document for FY 2018. The group’s report addressed the impacts of the proposed cuts and provided historical background and perspective on some of the environmental programs. The report indicated that the proposed FY 2018 budget for EPA of $5.7 billion, when adjusted for inflation, is at a level not seen since the mid-1970s just after the agency was formed and the proposed reductions to staff would bring the agency to its lowest level since 1984. However, since those times, Congress has expanded the agency’s mandate in nearly every program. The analysis concluded that the cuts are so far-reaching that nearly every activity will be affected, including the protection of air, water and climate from pollution, enforcement of environmental requirements, cleanup of Superfund sites, and analysis of chemicals and pesticides. The report also noted that the proposed reductions in state grants “would set states up for costly failure” because there are sanctions if states do not meet federal standards within a certain timeframe. “These sanctions apply regardless of whether the state agency have been adequately funded,” the report states. The group also issued a press release to accompany the analysis.

Administration Proposes Deep Cuts to EPA

March 16, 2017 – The Administration has released its “Budget Blueprint” for FY 2018 containing general information about its proposed budget, which calls for cuts to EPA’s budget of 31 percent, reductions in EPA staff of 21 percent and a 45-percent cut to categorical grants (Section 103 and 105 air quality grants are under the categorical grant line item). The budget proposal, entitled, America First: A Budget Blueprint to Make America Great Again, is not detailed enough to ascertain the impact on state and local air quality grants specifically; however, it states that “[t]his funding level eliminates or substantially reduces Federal investment in State environmental activities that go beyond EPA’s statutory requirements.” The reductions outlined in the proposal are more extensive than NACAA recently reported based on the Office of Management and Budget (OMB) “passback” document that the association obtained (see Washington Update of February 27-March 3, 2017). Other significant reductions in the budget blueprint include a 25-percent cut to funding for the Office of Enforcement and Compliance Assurance and a 48-percent decrease to the Office of Research and Development. The blueprint also calls for discontinuation of funding for the “Clean Power Plan, international climate change programs, climate change research and partnership programs, and related efforts;” elimination of funding for specific regional programs, such as the Great Lakes Restoration Initiative, the Chesapeake Bay and other geographic programs (stating “[t]he budget returns the responsibility for funding local environmental efforts and programs to State and local entities, allowing EPA to focus on its highest national priorities”); and elimination of over 50 EPA programs, including, among others, Energy Star; Targeted Airshed Grants; the Endocrine Disruptor Screening Program; and infrastructure assistance to Alaska Native Villages and the Mexico Border. In May 2017, the Administration is expected to propose a more specific budget, which will be submitted to Congress for consideration. Congress has the ultimate say in how much to appropriate to federal programs.

NACAA Comments on Draft n-PB Notice

March 13, 2017 – NACAA has submitted comments on EPA’s Draft Notice “Granting Petitions to Add n-Propyl Bromide to the List of Hazardous Air Pollutants,” which was published in the Federal Register on January 9, 2017 (82 Federal Register 2354.) In this notice EPA asked for public comment on a draft notice to grant a petition to add n-Propyl Bromide (n-PB) to the list of hazardous air pollutants (HAP) in Section 112 of the Clean Air Act. In the letter, NACAA stated that the petitioners in this case have satisfactorily established that n-PB meets the criteria for listing as a HAP and that EPA should grant the petition to add it to the HAP list under Section 112. NACAA noted that n-PB is a pollutant of great concern and that the National Toxicology Program has included it on its list of substances that are “reasonably anticipated to be a human carcinogen.” Furthermore, the use of n-PB is increasing and several state and local agencies are now regulating it. NACAA believes the protections from the adverse impacts from exposure to n-PB should be available to the public nationwide.

OMB Proposes Cuts to EPA Budget/Grants

February 28, 2017 – The U.S. Office of Management and Budget (OMB) has provided EPA with the FY 2018 budget “passback,” which outlines proposed devastating cuts to the agency’s budget, including a 30-percent reduction in state and local air grants from FY 2017 levels, a 24-percent cut to EPA’s overall budget and a decrease of 19 percent to staffing levels at EPA. The 23-page document details funding levels for EPA’s programs and includes the following significant provisions, among many others: $159.5 million for state and local air quality management grants (Section 103/105 grants), which is a 30-percent reduction from the FY 2017 level of $227.8 million; $6.16 billion for EPA’s overall budget, which is a 24-percent reduction from the FY 2017 level of $8.24 billion; a 12,397 full-time equivalent (FTE) staffing level for EPA, which is a 20-percent reduction from the FY 2017 level of 15,376 (some of which will be due to attrition, early retirement, buyouts or reductions in force); consolidation of 10 EPA regions into eight (a comprehensive plan to accomplish this is due to OMB by June 15, 2017); elimination of the Diesel Emission Reduction Act grant program (“other sources of federal and state funding are available to fund high priority projects and the legacy fleet will eventually be replaced by vehicles that use newer, cleaner engines.” The passback identifies the Volkswagen settlement as a possible alternate source of funding.); elimination of Targeted Airshed Grants; reduction of 69.4 percent in the Climate Protection Program. Funding is maintained for greenhouse gas reporting, accounting and basic analytical capabilities, but funding for regulatory and voluntary climate change mitigation programs is substantially reduced; elimination of the Indoor Air Radon Program and State Indoor Radon Grants; elimination of the Environmental Justice (EJ) office and a reduction of EJ funds by 77.7 percent from FY 2017 levels (“policies in place are strong enough to continue forward”); shift in focus for enforcement and compliance programs to “eliminating potential duplication of effort” including activities carried out by states. EPA will “shift focus to non-delegated programs and encourage states with delegated authorities to assume more active enforcement roles”; reduction of 32 percent in EPA’s Science and Technology budget; and elimination of a list of geographic and other programs, including Alaska Native Villages; Beach and Fish programs; Brownfield projects; Clean Power Plan implementation; Climate Voluntary partnership programs (14 programs); Endocrine grants; Energy Star grants (transfer “ownership and implementation of Energy Star to a non-governmental entity”); environmental education; geographical programs (Lake Champlain, Long Island Sound, San Francisco Bay and South Florida and near elimination of the Chesapeake Bay, Great Lakes Restoration and Puget Sound programs); Global Change Research; Mexico Border grants; multi-purpose grants; Office of Public Engagement; Science to Achieve Results (STAR) Research grants; Small minority business assistance; U.S. Mexico Border Program; and WaterSense. A passback is OMB’s response provided annually to federal agencies’ and departments’ initial budget proposals. Agencies have an opportunity to respond to the passback (in this instance, EPA was given until Wednesday, March 1, 2017 to respond) and then the Administration’s budget proposal is compiled based upon this process. The result is the Administration’s proposed budget that is sent to Congress. It is important to note that the Administration’s proposal is not the final budget. In appropriating funds, Congress can heed the Administration’s request or develop other budget amounts. News reports of the reactions of members of Congress indicate that some Representatives and Senators from both parties have expressed concerns about such significant cuts to EPA’s budget. In response to reports of significant cuts to state environmental grants, the Environmental Council of the States (ECOS) sent a letter to OMB Director Mick Mulvaney and EPA Administrator Scott Pruitt emphasizing the critical importance of grants to state programs and expressing concern about the profound impacts that grant reductions would have on states’ ability to “implement the core environmental programs as expected by our citizens.” ECOS noted that “[t]he time is now to meaningfully invest in state environmental agencies though robust – not reduced – STAG categorical grants.”

NACAA Sends Policy Recommendations to Trump Administration

February 17, 2017 – NACAA sent a paper to new EPA Administrator Scott Pruitt offering nine recommendations to the Trump Administration for improving the nation’s clean air program. Because NACAA’s members are vested with primary responsibility for ensuring the nation breathes clean, healthful air, they are “uniquely positioned to identify the greatest air quality challenges of the day and to offer advice for confronting those challenges,” the association explained. The paper includes one-page discussions of key issues associated with the following recommendations: (1) improve technical assistance to state and local agencies; (2) ensure state and local agencies have the resources they need to implement federal requirements; (3) improve regulatory assistance to state and local air agencies through effective federal measures for mobile and stationary sources; (4) continue and expand efforts to address the transport of air pollution; (5) ensure effective establishment and implementation of the National Ambient Air Quality Standards; (6) address critical air monitoring challenges; (7) identify and address toxic air pollution challenges; (8) support state and local efforts to address climate change; and (9) improve the integration of federal, state and local data programs and requirements. NACAA encouraged the Administration to work in close collaboration with the association as it embarks in policymaking and rulemaking processes and to empower state and local air agencies in every way possible to fulfill the goals of the Clean Air Act.

NACAA Comments on Proposed Ozone Implementation Rule

February 13, 2017 – NACAA submitted to the docket comments on EPA’s proposed rule on implementation of the 2015 ozone National Ambient Air Quality Standards (NAAQS) published in the Federal Register on November 17, 2016 (81 Fed. Reg. 81,276). Among NACAA’s comments with respect to international transport is that EPA should not place any unreasonable limitations on the opportunity for states to make demonstrations under Clean Air Act 179B (related to areas affected by international transport). The association also comments that in cases where emission sources are beyond a state’s jurisdiction and where international sources contribute significantly to ozone levels, it is unlikely that state efforts to impose control measures will have any meaningful impact on mitigating the public health effects of exposure to ozone, especially in many rural counties in the Western U.S. NACAA also notes that many states are struggling with how to meet their statutory clean air obligations in light of the challenges posed by transport, with Western states, in particular, concerned with the growing impact of international transport. Therefore, EPA should work closely with state and local air pollution control agencies to assess transport throughout all regions of the country and put in place appropriate programs to address this problem. On the issue of resources, NACAA calls on EPA to request additional, adequate federal funding to enable state and local air agencies to successfully fulfill their statutory responsibilities. In the comments, NACAA also addresses issues such as the transition from the 2008 ozone NAAQS to the 2015 ozone NAAQS, interprecursor trading for the nonattainment New Source Review offset requirement and Reasonably Available Control Technology determinations.

EPA Clarifies Announcement of Grant “Freeze”

January 24, 2017 – EPA announced that it was temporarily “freezing” (i.e., suspending) all contract and grant awards, effective immediately. Many stakeholders expressed concern about the impact of this announcement and sought additional information from EPA about how this would affect a variety of programs, including ongoing state and local air agencies’ activities. In the evening, EPA issued the following statement, clarifying its position on the suspension of grants and contracts: “EPA staff have been reviewing grants and contracts information with the incoming transition team. Pursuant to that review, the Agency is continuing to award the environmental program grants and state revolving loan fund grants to the states and tribes; and we are working to quickly address issues related to other categories of grants. The goal is to complete the grants and contracts review by the close of business on Friday, January 27.”

NACAA Seeks State/Local Information on VW Trust Activities

January 11, 2017 – As part of the settlement between the United States government and Volkswagen (VW) over the company’s alleged use of “defeat devices” designed to cheat on federal emission tests for diesel cars, a Mitigation Trust Fund has been established. This trust will provide a specific level of funding to each state for eligible projects that will reduce nitrogen oxides. While the program is still being established and funds have not yet been distributed, state and local agencies may have begun work on this effort, including developing beneficiary certification forms, drafting mitigation plans, establishing websites, reaching out to the public, etc. Since it may be useful for NACAA members and others to learn how state and local agencies are going about the tasks related to the VW Mitigation Trust Fund and what documents or resources others have developed, NACAA will compile information from agencies to be shared on NACAA’s publicly accessible website (www.4cleanair.org). Therefore, state and local air agencies are asked to send NACAA relevant documents or links that may be helpful to others and they will be compiled on NACAA’s website. This could include webpages, public outreach materials, drafts of certification forms, information about mitigation plans, etc. This will be an evolving website, so NACAA will welcome additional information as it is developed. Please send any materials to Mary Sullivan Douglas of NACAA at mdouglas@4cleanair.org.

NACAA Comments on Proposed Determination for MTE

December 23, 2016 – NACAA submitted comments to EPA Administrator Gina McCarthy on her November 30, 2016 Proposed Determination that existing greenhouse gas (GHG) emission standards for Model Year (MY) 2022-2025 light-duty vehicles (LDV) remain appropriate. The Administrator’s Proposed Determination follows a comprehensive Midterm Evaluation (MTE) required under a 2012 EPA-NHTSA rulemaking establishing GHG and fuel economy standards for LDVs to assess whether the “out-year” GHG standards included in the rule (those for MYs 2022-2025) are still appropriate based on the latest data and information or whether they should be more stringent or less stringent. In the comments, NACAA supports the Proposed Determination that the emission standards currently in place for MYs 2022-2025 remain appropriate under section 202(a)(1) of the Clean Air Act. The association “applauds the robust technical analysis behind the Proposed Determination” as well as EPA’s thoughtful and deliberative consideration of, and response to, public comments on the draft Technical Assessment Report released earlier this year. NACAA also commends EPA for the comprehensive explanation of the basis of the Proposed Determination including the thorough presentation of the updates made to the previous analyses, which NACAA believes “makes an exceptionally clear and strong case that the MYs 2022-2025 standards remain appropriate.” Further, NACAA concurs with EPA’s statements that the MY 2022-2025 standards are feasible and cost effective and that the auto industry is thriving and meeting the standards more quickly than required, as well as with the conclusion that the design of the national program, as established in the 2012 rule, provides flexibility to allow consumers to purchase the vehicles of their choice while ensuring substantial environmental benefits from all vehicle classes and weights. In addition, NACAA notes EPA’s conclusion that the net benefits of the program far exceed the costs.

Second VW Settlement Proposed with Additional Funds

December 20, 2016 – The federal government, California and automakers Volkswagen AG, Audi AG, Porsche AG and related entities (VW), have agreed to a partial settlement related to VW’s alleged use of emission test defeat devices on 83,000 model year (MY) 2009-2016 3.0-liter diesel vehicles. This is separate from an earlier and larger partial settlement agreement pertaining to 2.0-liter diesel vehicles. In this most recent case, for older vehicles (MY 2009-2012) VW will be required to buy back or terminate leases for the cars or offer an emissions modification, if VW proposes one and the regulators approve it. For newer vehicles (MY 2014-2016), if VW can make the vehicles compliant with the standards, it will be required to repair them and will not have to buy them back. Additionally, VW will provide $225 million to fund projects that will mitigate the past and future emissions of nitrogen oxide (NOx) resulting from the affected vehicles. This is in addition to the $2.7 billion that VW is required to place into a mitigation trust fund as a result of the settlement on the 2.0-liter vehicles. These additional funds will be placed into the same mitigation trust fund as the proceeds from the settlement from the 2.0-liter vehicles, with states, Puerto Rico, the District of Columbia and tribes eligible for specified amounts (listed in the proposed partial settlement). The expectation is that the funds will be used for the same types of projects identified as eligible for funding under the 2.0-liter vehicle settlement. There is a separate but related consent decree for California that was also announced, which includes special provisions for California, including Zero Emission Vehicle provisions and investments. The proposed partial settlement agreement was filed in U.S. District Court for the Northern District of California and will be subject to a public comment period for 30 days after it is published in the Federal Register. For further information: https://www.epa.gov/sites/production/files/2016-12/documents/30literpartialconsentdecree.pdf (see last page for state mitigation fund allocations), https://www.epa.gov/enforcement/volkswagen-clean-air-act-partial-settlement and https://arb.ca.gov/msprog/vw_info/second-ca-cd-threeliter.pdf.

Congress Passes FY 2017 CR through April 28, 2017

December 8-10, 2016 – By a vote of 326-96 in the House and 63-36 in the Senate, on December 8 and 9, respectively, Congress adopted H.R. 2028, a Continuing Resolution (CR) that will keep the federal government in operation until April 28, 2017 at FY 2016 levels of funding. President Obama signed the measure into law on December 10, 2016. As reported in the Washington Update of December 5-9, 2016, the previous CR, adopted on September 28, 2016, provided funding at FY 2016 levels through December 9, 2016. The CR provides continued funding at the rate of $228.2 million for state and local air quality grants, which was the amount appropriated in FY 2016, and does not include the controversial riders or provisions related to air pollution control programs that were included in the Congressional bills considered this past summer.

Congress Introduces CR for FY 2017

December 6, 2016 - Congressional leaders have announced another Continuing Resolution (CR) that will keep the federal government in operation until April 28, 2016 at FY 2016 levels of funding (H.R. 2028). Both houses are expected to adopt it this week and President Obama has indicated that he will sign it. With respect to state and local air quality grants under the Clean Air Act, the CR provides continued funding at the rate of $228.2 million, which was the amount appropriated in FY 2016. The CR does not include any of the controversial riders or provisions that would have affected air pollution control programs that were included in the House and Senate bills considered this past summer. The CR does add $170 million to address the lead water problems in Flint, Michigan. The previous CR, adopted on September 28, 2016, provided funding at FY 2016 levels through December 9, 2016. A CR was necessary to keep the federal government in operation beyond the end of the federal fiscal year – September 30, 2016 – because Congress has not adopted the individual funding bills to provide resources for federal operations (including EPA’s budget) in FY 2017. The latest CR delays budget decisions in order to provide the new Congress, which begins in January 2017, with an opportunity to weigh in on the federal budget for the remainder of FY 2017 (ending September 30, 2017). While the House originally favored a shorter-term CR ending in March 2017, the Senate requested additional time due to the expected workload related to confirmation of incoming Administration nominees.

Court Approves VW Settlement

October 25, 2016 – Judge Charles Breyer of the U.S. District Court for the Northern District of California has issued final approval for the partial consent decree with Volkswagen (VW) related to the company’s alleged illegal use of emission control "defeat devices" on nearly 500,000 2.0-liter diesel vehicles of Model Years 2009 through 2015 (U.S. v. Volkswagen AG, et al, Case No. 3:16-cv-00295). The consent decree calls for VW to, among other things, pay $2.7 billion for a Mitigation Trust Fund to be allocated among states and tribes for pollution reduction projects. The proposed partial consent decree was originally announced on June 28, 2016 and was subject to public comment. Based on this input and further negotiations among the parties (including VW, the U.S. Department of Justice [DOJ] and the California Air Resources Board), DOJ submitted an amended partial consent decree to the court on September 30, 2016. On October 18, 2016 Judge Breyer held a hearing, at which time he indicated that he would approve the agreement within the week. As reported in the Washington Update of October 3-7, 2016, there were not extensive changes to the proposed consent decree in response to public comments. The revisions were mostly contained in Appendix D of the proposed consent decree and included: allowing beneficiaries (e.g., states) 90 days, rather than 30, after being deemed a beneficiary to submit a “Beneficiary Mitigation Plan” that summarizes how the funds will be used; allowing newer engines to be eligible under the program (up to model year 2009, rather than model year 2006); providing greater flexibility with respect to the percentage of the costs of repowering and replacement that are permitted to be covered; and increasing the amount of administrative expenses that may be claimed from 10 percent to 15 percent of the total cost of an eligible mitigation action. Click here for access to relevant documents.

NACAA Comments on EPA’s Title V Petitions Process Proposal

October 24, 2016 – NACAA submitted comments on EPA’s proposed rule, Revisions to the Petition Provisions of the Title V Permitting Program, 81 Fed. Reg. 57,822 (Aug. 24, 2016). The proposal is intended to increase stakeholder access and understanding of the process by which citizens may object to Title V operating permits and to facilitate EPA’s review of proposed permits and petitions. NACAA’s comments focused on proposed amendments that would establish new procedures that state and local permitting authorities must follow in responding to public comments on draft Title V permits, developing the administrative record for permits and submitting proposed permits to EPA. NACAA opposed EPA’s proposal to require permitting authorities to provide public notice when they submit proposed permits to EPA for the agency’s 45-day review period. Requiring state and local agencies to publish what amounts to a second public notice for every Title V permit would go beyond what is required by the Clean Air Act and would be unduly burdensome for agencies that are struggling with limited resources, NACAA stated. In NACAA’s view, EPA should bear responsibility for notifying the public of the review and objection process, as these are not state or local agency functions and the review period starts upon EPA’s receipt of a proposed permit, not upon transmittal. NACAA supported EPA’s proposal to require permitting authorities to respond to significant public comments on draft permits, but it emphasized that any regulatory changes must continue to accommodate “concurrent” public and EPA review of draft permits (where the 30-day public comment period and EPA’s 45-day review period run simultaneously, so long as there are no significant public comments). NACAA pointed out areas where the proposed regulatory language should be clarified on this topic. Finally, NACAA also asked EPA to clarify proposed rule language related to permit statements of bases.

NACAA Provides Input on EPA’s FY 2018-19 NPM Guidance

October 12, 2016 – NACAA has submitted comments in response to EPA’s request for early input on the development of the FY 2018-19 National Program Manager (NPM) Guidances. The NPM Guidances outline the strategies and actions EPA and state, local and tribal agencies will undertake over the next two years to implement their programs and work toward the goals contained in EPA’s Strategic Plan. The guidance documents will be issued next spring in draft form and open to public comment. However, at this point, EPA sought early input before the agency began developing the guidance. NACAA emphasized in its comments that state and local air quality agencies are severely underfunded and it is essential that federal grants for these programs be increased significantly. Additionally, state and local agencies should be given as much flexibility as possible with respect to how these resources are spent. NACAA rearticulated points it has included in comments for previous years’ NPM guidance documents, including supporting EPA’s intention to work with state and local agencies to adjust resources to meet changing priorities and encouraging the agency to use the guidance as the basis for negotiations among federal, state and local air agencies. Finally, NACAA reiterated the recommendation that funding for fine particulate matter monitors remain under the authority of Section 103, where matching funds are not required, rather than shifting it to Section 105.

NACAA Comments on EPA-NHTSA-CARB Draft TAR

September 26, 2016 – NACAA submitted comments to EPA, NHTSA and CARB on the three agencies’ draft Technical Assessment Report (TAR) related to the Midterm Evaluation of the Model Year (MY) 2022-2025 light-duty vehicle GHG and CAFE standards adopted in 2012. In the comments, NACAA highlights the similar key conclusions reached by EPA and NHTSA based on their independent technical analyses and concurs with those conclusions, observing, among other things, that “automakers are firmly on track to meet the MY 2022-2025 standards without issue.” The association also identifies and comments on some differences between the analyses conducted by EPA and NHTSA – including different assumptions related to the penetration of rates of Zero Emission Vehicles and “Skyactiv” and Atkinson Cycle technology as well as the timing of full compliance – which result in higher cost estimates by NHTSA. NACAA also focuses on next steps post 2025, noting that “the magnitude and pace of technological innovation and advancement since 2012, as well as the cost effectiveness of these technologies, set the stage for next steps to further reduce GHG emissions and fuel efficiency from the light-duty fleet post 2025.”

House Passes REVIEW Act

September 21, 2016 – The House of Representatives passed, by a vote of 244 to 180, H.R. 3438, the Require Evaluation Before Implementing Executive Wishlists (REVIEW) Act, to prohibit any “high-impact” rule from taking effect until the final disposition of all actions seeking judicial review of the rule. Under the REVIEW Act, a “high-impact” rule is defined as one with an annual cost of more than $1 billion. The bill provides for an administrative stay of all such rules pending final judicial review if a legal challenge is filed within 60 days after publication of the rule in the Federal Register or within another time period explicitly provided for judicial review under the law authorizing a rulemaking. The bill also provides for the stay to be lifted if no challenge is filed. An amendment to exempt from the bill rules that would reduce health care costs for seniors failed (189 to 232), as did an amendment to exempt from the bill regulations that would make higher education more affordable (184 to 237). In anticipation of the House vote on the bill, the White House issued a Statement of Administration Policy (SAP) opposing H.R. 3438, saying it “would promote unwarranted litigation, introduce harmful delay, and, in many cases, thwart implementation of statutory mandates and the execution of duly enacted laws.” The White House indicates in the SAP that if the President is presented with H.R. 3438 his senior advisors will recommend that he veto it.

NACAA Urges Support for Reauthorization of DERA Legislation

September 8, 2016 – NACAA, as part of a coalition that also includes industry groups and environmental and public health organizations, signed a letter sent to 67 House Republicans thanking them for their support of continued appropriations for the Diesel Emissions Reduction Act (DERA) and asking them to cosponsor H.R. 5913, a bipartisan bill – introduced by Rep. Renee Ellmers (R-NC) and Doris Matsui (D-CA) – to reauthorize DERA for another five years. In the letter, the coalition highlights the cost effectiveness of the DERA program, noting EPA’s estimates that every $1 in federal assistance is met with another $3 in non-federal matching funds and generates $7 to $18 in health and economic benefits. As indicated in the letter, EPA also estimates that the DERA program has resulted in the upgrading of nearly 73,000 vehicles or pieces of equipment for total lifetime emissions reductions of 335,200 tons of nitrogen oxide and 14,700 tons of particulate matter, which equate to approximately $12.6 billion in health benefits. The coalition also explains that every state benefits from DERA, with 30 percent of funding dedicated to supporting state programs. In addition to NACAA, those signing the letter include the American Association of Port Authorities, American Highway Users Alliance, American Lung Association, American Trucking Associations, Associated General Contractors of America, Association of American Railroads, Caterpillar, Inc., Clean Air Task Force, Corning Incorporated, Cummins Inc., Diesel Technology Forum, Emissions Control Technology Association, Environmental Defense Fund, Foss Maritime Company, Interstate Distributor, Manufacturers of Emission Controls Association, NAFA Fleet Management Association, National Association for Pupil Transportation, National Association of State Directors of Pupil Transportation Services, National School Transportation Association, Natural Resources Defense Council, Navistar, Saltchuk, Thomas Built Buses, Umicore Autocat, Inc. and United Motorcoach Association.

Emissions from Oil and Gas Operations Threaten Children’s Health

August 31, 2016 – According to a report released by Clean Air Task Force and Earthworks ozone that occurs as a result of emissions from oil and gas operations poses a substantial health threat to children who suffer from asthma. In Gasping for Breath: An Analysis of the Health Effects from Ozone Pollution from the Oil and Gas Industry, the two groups quantify the impacts on health nationally from ambient ozone formed from emissions from the oil and gas industry. Among the specific conclusions drawn in the report are that each summer ozone resulting from oil and gas pollution causes more than 750,000 asthma attacks in children under the age of 18 as well as over 2,000 asthma-related emergency room visits and more than 600 respiratory related hospital admissions. In addition, the authors report that children miss 500,000 days of school annually due to ozone resulting from oil and gas pollution. Accompanying the report is an “Oil and Gas Threat Map,” developed by Earthworks and FracTracker Alliance, that illustrates health impacts across the country from pollution from the oil and gas industry.

EPA/DOT Issue GHG and Fuel Efficiency Rules for Heavy-Duty Trucks

August 16, 2016 – EPA and the U.S. Department of Transportation’s National Highway Traffic Safety Administration (NHTSA) have issued standards designed to reduce greenhouse gas (GHG) emissions and improve fuel efficiency for medium- and heavy-duty vehicles. The final rules represent the second phase of regulations on medium- and heavy-duty vehicles (the first phase applied to model years 2014-2018). Specifically, EPA’s GHG and NHTSA’s fuel-consumption standards apply to four categories of heavy-duty vehicles: (1) Combination Tractors, which account for approximately 60 percent of total GHG emissions and fuel consumption from the heavy-duty sector; (2) Trailers (which are pulled by combination tractors and contribute significantly to the emissions and fuel consumption of tractors); (3) Heavy-duty Pickup Trucks and Vans, which account for about 23 percent of the fuel con¬sumption and GHG emissions from the heavy- and medium-duty vehicle sector; and (4) Vocational Vehicles, including all other heavy-duty vehicles such as buses, garbage trucks, and concrete mixers, which represent about 17 percent of the total medium- and heavy-duty fuel consumption. There are also separate standards for the engines that power combination tractors and vocational vehicles. The new vehicle and engine performance standards would apply to model years (MY) 2021-2027 for semi-trucks, large pickup trucks, vans and all types and sizes of buses and work trucks. Additionally, for the first time, the new regulations include fuel-efficiency and GHG standards for trailers, applying to MY 2018-2027 for certain trailers. EPA’s trailer standards, which do not include certain categories (e.g., mobile homes), take effect in MY 2018, while NHTSA’s standards take effect as of 2021, with credits for voluntary early participation. According to EPA and NHTSA estimates, by 2027 the Phase 2 standards will reduce emissions of carbon dioxide (CO2) by 1.1 billion metric tons, save vehicle owners approximately $170 billion in fuel costs and decrease oil consumption by as much as two billion barrels over the life of the vehicles affected by the regulation. Further, the federal government estimates that the standards’ net benefits of $230 billion outweigh the costs by approximately eight to one. EPA and NHTSA worked closely together and with the state of California to harmonize standards under the program.

EPA Extends Deadline for Acting on Delaware’s Section 126 Petition

August 15, 2016 – EPA has announced that it is extending by six months the deadline for the agency to respond to a Section 126 petition that Delaware’ submitted on July 7, 2016. Delaware asked EPA to find that the Brunner Island Steam Electric Station in York County, Pennsylvania, is emitting air pollutants that significantly contribute to nonattainment or interfere with maintenance of the 2008 and 2015 ozone national ambient air quality standards in Delaware. Section 126 of the CAA allows a state to request that EPA establish emission limits for sources in other states that significantly contribute to air quality problems in the petitioning state. The Act calls for EPA to respond to such requests within 60 days. According to EPA’s action, the agency determined that “60 days is insufficient time to complete the technical and other analyses and public notice and comment process required for our review of a petition submitted by the state of Delaware pursuant to section 126 of the Clean Air Act (CAA).” The new deadline is March 5, 2017.

NACAA Comments on FHWA’s Consideration of GHG Emissions Measure

August 11, 2016 – NACAA submitted comments to the Federal Highway Administration (FHWA) on a particular aspect of a Notice of Proposed Rulemaking (NPRM) to implement provisions of the 2012 surface transportation planning law, MAP-21 (Moving Ahead for Progress in the 21st Century), which requires transportation planners to consider and find ways to reduce transportation-related pollution, including through the use of performance-based measures. According to FHWA, the rulemaking is intended to improve accountability, address the nation’s congestion problems and make available “valuable information about how transportation investments are performing and delivering reliable highway travel with minimal delays and less air pollution.” Included in the NPRM is a request for comments on whether and how to establish a measure to track carbon emissions from transportation. It is this component of the NPRM, called “Consideration of a Greenhouse Gas Emissions Measure,” on which NACAA focused its comments. In particular, NACAA offered support for a GHG emissions measure and provided responses to a number of questions posed by FHWA related to designing such a measure, including, among others, whether the measure should address all onroad mobile sources or a particular vehicle type; include nonroad sources; be limited to tailpipe emissions or extend to emissions generated upstream in the lifecycle of vehicle operation; and estimate CO2 emissions performance based on gasoline and diesel fuel sales, vehicle miles traveled or other surrogates.

NACAA Comments on Proposed RHR Revisions

August 10, 2016 – NACAA submitted comments to EPA on the agency’s proposed revisions to the 1999 Regional Haze Rule (RHR), intended to "streamline, strengthen, and clarify" various aspects of the program, under which states are required to set goals and emission reduction strategies to improve visibility in federal Class I areas. Among the specific proposed revisions to which NACAA responded are ones to 1) extend by three years, from July 31, 2018 to July 31, 2021, the State Implementation Plan (SIP) submittal deadline for the second regional haze planning period; 2) remove the requirement that interim progress reports be in the form of a SIP revision; 3) replace the recurring process of assessing reasonably attributable visibility impairment (RAVI) with an as-needed approach and extend the applicability of RAVI to all states, rather than only those with Class I areas; 4) require that states consult with Federal Land Managers earlier in the SIP development process and 5) determine how days are selected for tracking progress. EPA expects to issue final revisions to the RHR this fall.

NACAA Comments on DOJ Proposed Consent Decree with VW

August 2, 2016 – NACAA has submitted comments on the U.S. Department of Justice’s “Notice of Lodging of Partial Consent Decree Under the Clean Air Act” that was published in the Federal Register on July 6, 2016. This notice related to the proposed settlements with Volkswagen (VW) announced on June 28, 2016 to address the company's alleged illegal use of emission control "defeat devices" on nearly 500,000 2.0-liter diesel vehicles of Model Years 2009 through 2015. Under the proposed settlements, VW agrees to pay, among other things, $2.7 billion for a Mitigation Trust Fund to be allocated among every state in the nation (including the District of Columbia and Puerto Rico) as well as tribes to undertake pollution reduction projects. NACAA’s comments are based in large part on the association’s Recommendations for the Distribution of Funds for Environmental Mitigation and Supplemental Environmental Projects Related to Alleged Volkswagen Violations, which the members adopted on May 17, 2016. In the comments, NACAA compliments DOJ for establishing a program that requires VW to mitigate the environmental harm the company allegedly caused and for incorporating into the Consent Decree (CD) many of the elements that NACAA called for in its recommendations, including providing significant resources for state and local agencies to address the excess NOx emissions. NACAA recommends that prior to entering a final CD, DOJ convene a discussion with state and local air pollution control agencies concerning practical administrative and process issues related to the implementation of the Mitigation Trust fund program. NACAA also offers refinements to the proposal in order to strengthen and clarify it including incorporating a mechanism for local air pollution control agencies to receive funds directly under the program; expanding the list of eligible mitigation actions to include, among other things, a mechanism for additional projects and programs to be approved; providing additional time for beneficiaries to submit their initial plans; clarifying the recording and reporting requirements for beneficiaries; and providing additional guidance to clarify eligible administrative expenses. The partial consent decree is subject to the approval of Judge Charles Breyer of the U.S. District Court for the Northern District of California.

House Votes on EPA Appropriations Bill

July 14, 2016 – By a vote of 231-196, the U.S. House of Representatives voted to adopt H.R. 5538 – the “Department of the Interior, Environment, and Related Agencies Appropriations Act, 2017,” which includes funding for EPA for FY 2017. This is the first time since 2009 that the House has passed a stand-alone bill that includes EPA’s budget. However, The Senate has not yet considered its version of the appropriations legislation and will not do so before the Congressional recess that will extend past Labor Day. This opens up the likelihood that a Continuing Resolution will be needed to keep the federal government in operation after September 30, 2016. Additionally, on July 11, 2016, the White House issued a Statement of Administration Policy expressing the President’s opposition to the bill and indicating that he would veto it if it is adopted with the provisions to which he objects (see related article). The House bill calls for $7.9 billion in FY 2017 for EPA’s budget (the Administration’s request was $8.27 billion) and provides $228.2 million for state and local air grants under Sections 103 and 105 of the Clean Air Act, which is equal to the FY 2016 appropriation and $40 million less than the President’s request. The House bill contains air-related provisions, including, among others: (1) $100 million for grants under the Diesel Emission Reduction Act (DERA) program; 2) $40 million for the Targeted Airshed Grant program; 3) retention of funding for fine particulate matter monitoring under Section 103 authority, rather than transitioning to Section 105 authority as EPA proposed; 4) prohibition on funds being used for Section 111(b) rules related to greenhouse gas (GHG) emissions from new units; 5) prohibition on funds being used for Sections 111(b) or 111(d) rules related to GHG emissions from modified, reconstructed or existing units; 6) postponement of the implementation of the 2015 ozone NAAQS by up to eight years; and 7) prohibition on EPA developing rules or guidelines to address methane emissions in the oil and natural gas sector. During the debate on the floor, the House considered over 130 amendments covering a range of topics. Several noteworthy ones included: a set of amendments proposed by Democrats to eliminate provisions in the bill that prohibit EPA activities related to greenhouse gas emissions from power plants, EPA’s program to reduce ozone-depleting substances and EPA’s use of the Social cost of Carbon estimates (rejected); a provision prohibiting EPA from using Section 115’s international provisions to regulate GHGs (adopted); a provision preventing EPA from issuing the final Clean Energy Incentive Program that provides credit to states for early action under the Clean Power Plan (adopted); a prohibition on EPA taking action under the Clean Air Act without analyzing economic effects (adopted); a provision to prevent EPA rulemaking on accidental release prevention requirements under the Risk Management Program (adopted); the elimination of over $88 million from EPA’s Air, Climate and Research Program (rejected); an amendment to remove provisions in the bill that opposed the President’s Executive Orders on climate change and sustainability (rejected); and a provision to eliminate funding for Diesel Emission Reduction Grants (rejected).

Comment Period Open on Proposed VW Consent Decree

July 6, 2016 – The Department of Justice published in the Federal Register (81 Fed. Reg. 44,051) a Notice of Lodging of Partial Consent Decree Under the Clean Air Act related to the proposed settlements with Volkswagen (VW) announced on June 28, 2016 (see related article in the June 27-July 1, 2016 Washington Update) to address the company's illegal use of emission control "defeat devices" on nearly 500,000 2.0-liter diesel vehicles of Model Years 2009 through 2015. This publication opens a 30-day comment period on the partial consent decree. In addition to the federal government and California considering public comments, the partial consent decree is subject to the approval of Judge Charles Breyer of the U.S. District Court for the Northern District of California. Under the proposed settlements, VW agrees to pay nearly $15 billion—$10.033 billion to compensate consumers; $2.7 billion for a Mitigation Trust Fund to be allocated among every state in the nation (including the District of Columbia and Puerto Rico) as well as tribes to undertake pollution reduction projects; and $2 billion for the auto maker to support increased use of technology for Zero Emission Vehicles. The proposed settlements apply only to affected 2.0-liter vehicles; action on 3.0-liter vehicles is still pending. In addition, the settlements do not address civil claims or criminal liability.

June 30, 3016 – NACAA submitted comments on EPA’s proposal to revise the minimum requirements for near-road nitrogen dioxide (NO2) monitoring by removing the requirements for near-road NO2 monitoring stations in Core Based Statistical Areas (CBSAs) with populations between 500,000 and 1,000,000 people. Under the existing regulations, those monitors must be reflected in states’ Annual Monitoring Network Plans by July 1, 2016, and they must be installed and operational by January 1, 2017. The monitors would comprise “Phase 3” of the three-stage deployment of the near-road NO2 network. NACAA supported EPA’s proposal to remove the Phase 3 requirements and commended the agency for recognizing and working to ameliorate the burden it would place on state and local agencies in exchange for minimal public health or research benefits. EPA’s analysis of the NO2 data collected from Phase 1 and 2 monitors found no NO2 data exceeding or threatening the NO2 National Ambient Air Quality Standards (NAAQS), even in the most highly populated areas. NACAA agrees with EPA that the Phase 3 monitors, which would be located in relatively smaller cities, would almost certainly measure lower or similar NO2 concentrations well below the NO2 NAAQS. In light of these conclusions, NACAA opined that the resources that would be required to implement Phase 3 of the near-road NO2 network would be better directed to other, critically important, monitoring activities that state and local agencies will undertake in the coming years.

Three Local Air Agencies Among Winners of Clean Air Excellence Awards

June 28, 2016 – Three NACAA member agencies from California were among the recipients of EPA’s 15th annual Clean Air Excellence Awards. The Santa Barbara County Air Pollution Control District (APCD) and the Ventura County APCD, along with partners Channel Islands National Marine Sanctuary, Environmental Defense Center and National Marine Sanctuary Foundation, received the Community Action Award for their project, Protecting Blue Whales and Blue Skies. Aeron Arlin Genet, Santa Barbara County Air Pollution Control Officer (APCO) and Mary Byrd, Community Programs Sponsor of the Santa Barbara County APCD, and Mike Villegas, Ventura County APCO, and John Zaragoza, Ventura County Supervisor and Chair of the Ventura County Air Pollution Control Board, accepted the award on behalf of their respective agencies. The Great Basin Unified Air Pollution Control District received one of two awards for Regulatory/Policy Innovations for its Owens Lake PM10 Project. Accepting the award were Phillip Kiddoo, Great Basin APCO; Ted Schade, former (retired) Great Basin APCO; Dr. Grace Holder, Playa Geologist/Senior Geologist; Nik Barbieri, Owens Lake Director of Technical Services; and Chris Lanane, Air Monitoring Specialist. Other award recipients were the Georgia Ports Authority for its Clean Air Technology project, Electric Rubber Tire Gantry Cranes; SmartPower for its Community Action project, Rhode Island Energy Challenge: Find Your Four!; Southern Ute Indian Tribe Air Quality Program for its Regulatory/Policy Innovations project, Implementation of a Part 70 Operating Permit Program; University of California Irvine Transportation Services for its project, Sustainable Transportation Program; and Dr. John C. Wall, former (retired) Chief Technical Officer of Cummins, Inc., who received the Thomas W. Zosel Outstanding Individual Achievement Award. EPA Administrator Gina McCarthy and Acting Assistant Administrator Janet McCabe spoke at the awards ceremony, which was held in the Administrator’s Green Room. Congratulations to all of the winners!

VW to Pay up to $14.7 Billion Under Proposed 2.0-Liter Settlements

June 28, 2016 – The Department of Justice filed a notice of lodging of partial consent decree in the U.S. District Court for the Northern District of California, San Francisco Division, to partially settle allegations by EPA and California that Volkswagen (VW) used illegal defeat devices on Model Year 2009 through 2015 diesel vehicles to evade emission tests. In addition, the Federal Trade Commission filed, in the same court, a partial stipulated order for permanent injunction and monetary judgment, also to partially settle the VW case.

Under the settlements – which are subject to public notice in the Federal Register (expected this week) and a 30-day comment period – VW and related entities agree to spend up to $14.7 billion. Up to $10 billion of this total is to compensate consumers and get the vehicles off the road through buyback, repair and additional compensation programs. Another $2.7 billion will go into a mitigation trust fund be allocated among every state (including DC and Puerto Rico) in the nation as well as tribes – a minimum of $6.5 million per state – to undertake pollution reduction projects to offset the excess emissions that occurred from the affected vehicles. The final $2 billion will be spent by VW to expand infrastructure for and improve access to zero-emitting vehicles.

These settlements apply only to affected 2.0 liter vehicles; action on 3.0 liter vehicles is still pending. In addition, the settlements do not address civil claims or criminal liability.

NACAA is pleased to note that with respect to mitigation the settlement incorporates many of the recommendations included in the document adopted by the NACAA members last month at the association’s membership meeting.
More information on the settlements is available here.

Senate Appropriations Committee Approves FY 2017 Budget Bill

June 16, 2016 – The Senate Appropriations Committee has marked up and approved, by a party-line vote of 16-14, the FY 2017 bill that funds EPA. Earlier in the week, the Senate Appropriations Subcommittee on Interior, Environment, and Related Agencies reported the bill to the full Committee. The Senate bill calls for $8.12 billion for EPA, as compared to the President’s request of $8.27 billion and the House Appropriations Committee’s recommended amount of $7.98 billion. The Senate Committee rejected the President’s $40 million increase for state and local air grants and, instead, approved last year’s enacted level of $228.2 million. In addition, the bill includes $25 million for the Diesel Emissions Reduction Act (DERA) program (the President requested $10 million and the House called for $100 million) and $20 million for Targeted Airshed grants (the President did not recommend any funding for this program and the House called for $40 million). The Senate bill does not contain the controversial air-related riders included in the House version of the bill. During the full committee mark-up, Senator Shelley Moore Capito (R-WV) introduced an amendment that would have prohibited EPA from expending funds on any Clean Power Plan-related activities while the court’s stay on the regulation is in effect. Senator Capito expressed her “strong feelings” for the amendment and then withdrew the measure, indicating that she felt the bill itself would limit EPA’s spending in certain accounts related to the Clean Power Plan. The bill has a number of other important measures affecting the air program, some described in the accompanying committee report. Most notably, the Committee expressed disagreement with EPA’s implementation of the “directive from fiscal year 2016 to update the formula for State and Tribal Air Quality Management Grants,” directing the agency to “hold all States and regions harmless in fiscal year 2017 by allocating funds in the exact same manner as fiscal year 2016…Should the Agency update the formula, the Committee directs the Agency to provide the new formula and funding estimates” to the Committee. The Committee expressed its displeasure with EPA’s implementation of the multipurpose grant program “in a manner that was not flexible and aligns more directly with the Agency’s priorities. Given that such is the case, the Committee has not continued funding for the multipurpose grant program.” The Committee also expressed concern with “potentially overlapping implementation schedules related to the 2008 and 2015 standards for ground-level ozone” and has directed EPA to “provide the Committee with a report examining the potential for administrative options to enable States to enter into cooperative agreements with the Agency that provide regulatory relief and meaningfully clean up the air.” The Committee also expressed disappointment with the “Agency’s efforts to regulate methane from existing petroleum and gas sources,” and concluded, “States are adequately regulating methane emissions.” The Appropriations Committee expressed concern with the “mandate for fuel with a sulfur content of 0.1% in the North American Emission Control Area…having a disproportionately negative impact on vessels which have engines that generate less than 32,000 horsepower,” asking the agency to consider exempting these engines. Finally, with respect to wood stoves, the Committee noted that the “observed variance for the best current methods of measuring PM emission from new residential wood stoves may be too great for the test to reliably confirm compliance with the Step II, 2020 standard” and asked the Administrator to report back.

House Appropriations Committee Marks Up EPA FY 2017 Budget

June 15, 2016 – The House Appropriations Committee marked up and approved a bill containing EPA funding for FY 2017 by a vote of 31-18. Just prior to the mark-up, the House Appropriations Committee released drafts of the bill and the associated committee report that provided information about the measure. Some of this information, including a draft of the bill, had previously been made available at the time of the Subcommittee on Interior, Environment, and Related Agencies’ mark-up of the bill on May 25, 2016. The bill calls for $7.98 billion in FY 2017 for EPA’s budget (the President requested $8.27 billion). It also would provide $228.2 million for state and local air grants under Sections 103 and 105 of the Clean Air Act, which is equal to the FY 2016 appropriation and $40 million less than the President’s request. Other air-related provisions include the following: 1) $100 million for grants under the Diesel Emission Reduction Act (DERA) program (p. 78 of the bill); 2) $40 million for the Targeted Airshed Grant program (p. 78); 3) retention of funding for fine particulate matter monitoring under Section 103 authority, rather than transitioning to Section 105 authority as EPA proposed (p. 79); 4) prohibition on funds being used for Section 111(b) rules related to greenhouse gas (GHG) emissions from new units (p. 144); 5) prohibition on funds being used for Sections 111(b) or 111(d) rules related to GHG emissions from modified, reconstructed or existing units (p. 145); 6) postponement of the implementation of the 2015 ozone NAAQS by up to eight years (p. 150); 7) exemption of permitted sources from the 2015 ozone NAAQS under certain circumstances (p. 151); 8) prohibition on EPA using funds on rules or guidelines to address methane emissions in the oil and natural gas sector under Sections 111(b) or (d) (p. 151); 9) prohibition on the issuance of regulations calling for Title V permits for emissions from biological processes associated with livestock production (p. 138); 10) prohibition on the issuance of a rule that includes mandatory reporting of GHG emissions from manure management systems (p. 138); and 11) prohibition on EPA’s incorporation of the social cost of carbon into any rulemaking or guidance until a new Interagency Working Group revises the estimates (p. 149). The report language includes the following statement with respect to the funds for EPA’s operations: “Further, the amount provided does not include funding for EPA’s greenhouse gas rules for stationary sources, including efforts to develop Federal Implementation Plans while the Supreme Court has stayed the regulations. The Committee is concerned that EPA continues to expend funds on related activities despite the Supreme Court ordered stay on the regulations. These funds would be better used to address the backlog of State Implementation Plans that EPA has yet to approve. As such, within the funds provided, the Committee includes $3,000,000 to enhance the efficiency and effectiveness of both preconstruction and operating permitting programs.” During the mark-up, the committee considered various amendments, including one offered by the Subcommittee on Interior, Environment, and Related Agencies Ranking Member Betty McCollum (D-MN) to strip the bill of several provisions related to EPA’s budget, including prohibitions on the use of funds for greenhouse gas-related activities. The amendment failed, so the provisions remain in the bill. The draft committee report has important information on the following pages: EPA budget, page 54; STAG, page 68; DERA, page 70; Targeted Airshed Grants, page 71; EPA tables, page 160; STAG tables, page 165. The draft bill is also available.

Senate Subcommittee and Full Committee Mark Up FY 2017 Budget Bill

June 14 and 16, 2016 – The Senate Appropriations Subcommittee on Interior, Environment, and Related Agencies (June 14, 2016) and then the full Senate Appropriations Committee (June 16, 2016) marked up and approved the FY 2017 appropriations bill that contains funding for EPA. The subcommittee approved the bill by a voice vote and the full Senate Appropriations Committee approved it by a vote of 16-14. The Senate bill calls for $8.12 billion for EPA, as compared to the President’s request of $8.27 billion and the House subcommittee’s recommended amount of $7.98 billion. The Committee has not yet released the details of the final bill, including the amount of state and local air grants. However, information NACAA has received indicates that bill includes $25 million for the Diesel Emissions Reduction Act (DERA) program (the President requested $10 million and the House called for $100 million) and $20 million for Targeted Airshed grants (the President did not recommend any funding for this program and the House called for $40 million). It does not appear that the Senate bill contains the controversial air-related riders included in the House version of the bill. During the full committee mark-up, Senator Shelley Moore Capito (R-WV) introduced an amendment that would have prohibited EPA from expending funds on any Clean Power Plan-related activities while the court’s stay on the regulation is in effect. Senator Capito spoke in favor of the amendment, articulating her wish to express her “strong feelings” and then withdrew the measure, indicating that she felt the bill itself would limit EPA’s spending in certain accounts related to the Clean Power Plan.

NACAA Releases Clean Power Plan Menu of Options

May 21, 2015 – The National Association of Clean Air Agencies (NACAA) has released a comprehensive technical resource to help states comply with the U.S. Environmental Protection Agency’s (EPA’s) proposed Clean Power Plan (CPP). Implementing EPA’s Clean Power Plan: A Menu of Options examines a wide range of technologies and policies that states might consider as they develop plans to reduce power-sector greenhouse gas (GHG) emissions and achieve the state-specific emissions targets set by EPA in the CPP. The Menu of Options contains 26 detailed chapters, 25 of which explore various approaches to reducing GHG emissions in the electric sector. Many of these compliance options include technologies and policies beyond the four building blocks EPA used to set state CPP targets. It looks first at proven technologies for lowering emissions, and then at various policies that have been demonstrated to promote or facilitate emissions reductions. Each chapter includes a common core of information that begins with a profile of the particular approach, followed by discussions of its regulatory backdrop, policy underpinnings, and implementation experiences. Each chapter also examines the co-benefits of the approach, including but not limited to reductions of non-GHG pollutants, as well as an examination of costs and cost-effectiveness. Finally, in the 26th chapter, the Menu of Options addresses emerging technologies and other important policies that regulators may wish to consider as they formulate plans to reduce power sector GHG emissions. NACAA’s Menu of Options was drafted by the Regulatory Assistance Project and reviewed by a NACAA 111(d) Steering Committee, comprised of state and local NACAA members from across the country. For further information: http://www.4cleanair.org/NACAA_Menu_of_Options

House Adopts Bill to Delay Implementation of 2015 Ozone Standards

June 8, 2016 – The House of Representatives—by a vote of 234 to 177—approved H.R. 4775, the Ozone Standards Implementation Act of 2016. The bill, introduced in March 2016 by Rep. Pete Olson (R-TX), was reported by the House Energy and Commerce Committee by a party-line vote on May 18, 2016. H.R. 4775 would, among other things, postpone implementation of the 2015 National Ambient Air Quality Standards (NAAQS) for ozone by up to eight years; allow consideration of technological feasibility when EPA sets NAAQS for any criteria pollutant; extend the NAAQS review cycle from five years to 10 years; exempt permitted sources from new or revised NAAQS if EPA does not publish implementation rules or guidance when it publishes the NAAQS—instead, sources would be allowed to meet the preconstruction review requirements of an outdated standard; allow stagnation, drought or high temperatures to be considered exceptional events; eliminate requirements for contingency measures in Extreme ozone nonattainment areas; and require EPA to report to Congress on emissions emanating from outside the U.S. and conduct a study on ozone formation. Six amendments to the bill were considered: 1) to provide that no additional funds be authorized to implement the Act (Rep. Ed Whitfield, R-KY)—passed by a vote of 236-170; 2) to allow federal, state, local or tribal permitting agencies to opt out of provisions of the bill exempting permitted sources from new or revised NAAQS in the absence of timely EPA rules or guidance if a permitting agency determines that issuing a preconstruction permit under an outdated and less protective standard is likely to have specified adverse impacts (Rep. Bobby Rush, D-IL)—failed by a vote of 171-235; 3) to strike consideration of technological feasibility when establishing NAAQS (Rep. Frank Pallone, D-NJ)—failed by a vote of 169 to 242; 4) to call for the EPA study on ozone formation required by the bill to analyze the relative contribution from wildfires (Rep. Paul Gozar, R-AZ)—passed by voice vote; 5) to amend the Clean Air Act (CAA) to repeal the exemption for aggregation of emissions from oil and gas sources and add provisions requiring EPA to list hydrogen sulfide as a hazardous air pollutant (Rep. Jared Polis, D-CO)—failed by a vote of 160 to 251; and 6) to provide that the bill would not apply if the EPA Administrator, in consultation with the Clean Air Scientific Advisory Committee, finds that application of any section could harm human health or the environment (Rep. Eleanor Holmes Norton, D-DC)—failed by a vote of 169 to 242. The White House issued a Statement of Administration Policy on June 7, 2016 expressing strong opposition to H.R. 4775, stating that it “would undermine the vitally important environmental and health protections of the CAA” and indicating that if the President were presented with the bill, his senior advisors would recommend that he veto it.

States, Localities Petition EPA for Tighter HD NOx Standards

June 3, 2016 – Eleven state and local environmental agencies, led by the South Coast Air Quality Management District (SCAQMD) in California, formally petitioned EPA to adopt a significantly stricter nitrogen oxide (NOx) emission limit for heavy-duty trucks – 0.02 grams per brake horsepower-hour (g/bhp-hr), down from the current 0.2 g/bhp-hr. In their “Petition for Rulemaking to Adopt Ultra-Low NOx Exhaust Emission Standards for On-Road Heavy-Duty Trucks and Engines,” the group cites the huge contribution of heavy-duty truck NOx emissions to elevated levels of ozone as well as other pollution problems, including particulate matter, visibility impairment and eutrophication of water bodies. In the words of Wayne Nastri, SCAQMD’s Acting Executive Officer, “In order to meet national clean air goals, we need the federal government to adopt more stringent standards for the No. 1 source of smog-forming emissions in our region—heavy-duty trucks …. A tougher federal truck emission standard will benefit air quality not only in the Southland but also in many areas across the country that currently fail to meet clean air standards.” Among the specific actions the signatories ask EPA to take are the following: 1) Develop a rulemaking for an ultra-low NOx exhaust emission standard of 0.02 g/bhp-hr for onroad heavy-duty engines with a proposal by July 2017 and a final rule by December 31, 2017; 2) require ultra-low NOx engines to meet the 0.02-g/bhp-hr standard by January 1, 2022; 3) if the ultra-low NOx standard is not feasible for certain classes or vocations of vehicles by January 1, 2022, allow for a phase in to the new standard with an interim standard for some engines of not greater than 0.05 g/bhp-hr and with full implementation of the 0.02-g/bhp-hr standard to occur by January 1, 2024; and 4) encourage early development and deployment of the ultra-low NOx standard by developing guidelines under the Diesel Emissions Reduction Act to provide incentives to truck owners to upgrade their engines. Joining South Coast as co-petitioners are Akron (Ohio) Regional Air Quality Management District; Bay Area (California) Air Quality Management District; Connecticut Department of Energy and Environmental Protection; Delaware Department of Natural Resources and Environmental Control, Division of Air Quality; New Hampshire Department of Environmental Services; New York City Department of Environmental Protection; Pima County (Arizona) Department of Environmental Quality; Puget Sound (Washington) Clean Air Agency; Washington State Department of Ecology, Air Quality Program; and Washoe County (Nevada) Health District, Air Quality Management. The petitioners also provided various documents and other materials in a set of attachments to the petition.

House Subcommittee Approves EPA Funding Bill for FY 2017

May 25, 2016 – The House Appropriations Subcommittee on Interior, Environment, and Related Agencies approved the FY 2017 appropriations bill that contains funding for EPA and reported it to the full Appropriations Committee. The bill calls for a total of $7.98 billion in FY 2017 for EPA’s budget, as compared to the President’s request of $8.27 billion for the agency in FY 2017. While the bill does not contain information for all of the specific programs in EPA’s budget (this information is typically included in report language, which has not yet been issued), it is expected that the bill will include $228.2 million for state and local air grants under Sections 103 and 105 of the Clean Air Act, which is equal to the FY 2016 appropriation and $40 million less than the President’s request. Other provisions related to the air program include the following: 1) $100 million for grants under the Diesel Emission Reduction Act (DERA) program (compared to $50 million in FY 2016 and $20 million in the President’s request) (p. 78 of the bill); 2) $40 million for the Targeted Airshed Grant program (compared to $20 million in FY 2016 and $0 in the President’s request) (p. 78); 3) retention of funding for fine particulate matter monitoring under Section 103 authority, rather than transitioning to Section 105 authority as EPA proposed (p. 79); 4) prohibition on funds being used for Section 111(b) rules related to greenhouse gas (GHG) emissions from new fossil fuel-fired electric utility generating units (p. 144); 5) prohibition on funds being used for Sections 111(b) or 111(d) rules related to GHG emissions from modified, reconstructed or existing fossil fuel-fired electric utility generating units (p. 145); 6) postponement of the implementation of the 2015 ozone NAAQS by up to eight years (p. 150); 7) exemption of permitted sources from the 2015 ozone NAAQS under certain circumstances (p. 151); 8) prohibition on EPA using funds on rules or guidelines to address methane emissions in the oil and natural gas sector under Sections 111(b) or (d) (p. 151); 9) prohibition on the issuance of regulations calling for Title V permits for emissions from biological processes associated with livestock production (p. 138); 10) prohibition on the issuance of a rule that includes mandatory reporting of GHG emissions from manure management systems (p. 138); and 11) prohibition on EPA’s incorporation of the social cost of carbon into any rulemaking or guidance until a new Interagency Working Group revises the estimates (p. 149). Also on Wednesday, EPA’s Deputy Chief Financial Officer issued a memorandum providing information on the FY 2017 bill, including tables summarizing the appropriation to EPA and 17 legislative riders related to EPA’s regulatory authority.

Researchers Link Air Pollution and Increased Risk of Stillbirth

May 24, 2016 – After conducting a systematic review and meta-data analysis of existing evidence from 13 studies, researchers concluded that there is “suggestive evidence” that exposure to ambient air pollution is a risk factor for stillbirth. Specifically, the researchers—all members of the Faculty of Medicine at the University of Oulu in Finland—found that a 4-microgram-per-cubic-meter increase in exposure to fine particulate matter was linked to a 2-percent increase in the risk of stillbirth; exposure to nitrogen dioxide, carbon monoxide, PM10 and ozone were also found to be associated with increased risk. In the results of their study, which were published in the journal Occupational & Environmental Medicine, the authors note that pregnant women should be aware of the potential adverse impacts of air pollution even though preventing exposure to air pollution “generally requires more action by the government than by individuals.” They call for the development and implementation of policies to control vehicle and industrial waste emissions and improve fuel quality. The authors also note that most of the studies they reviewed were based on monitoring data and they suggest that future studies integrate the use of personal monitoring methods and consider the activities of pregnant women. The study is entitled, Prenatal ambient air pollution exposure and the risk of stillbirth: systematic review and meta-analysis of the empirical evidence.

NACAA Recommendations on Distribution of Funds from VW Case

May 17, 2016 – At the NACAA 2016 Spring Membership Meeting in Santa Fe, NM, the association voted to adopt a set of recommendations on the distribution of funds for environmental mitigation and supplemental environmental projects that may result from resolution of enforcement actions in the alleged Volkswagen (VW) defeat devices violations. In the VW case, the company allegedly equipped certain light-duty diesel vehicles with software intended to impede, or “defeat,” emission control devices during normal driving situations, resulting in excess emissions of nitrogen oxide (NOx). Since state and local air pollution control agencies are charged with addressing emissions of NOx, and the other pollution that results from NOx (e.g., ozone, particulate matter), NACAA recommends that state and local air agencies receive significant resources from any mitigation or SEP funds resulting from the VW case to be used to advance clean air efforts. Such funding should not result in decreases in other funds provided to state and local air agencies. NACAA recommends that each state or local air agency receive funding in proportion to the extent of the problem VW caused in their jurisdictions and identifies several criteria to consider in disseminating funds (e.g., the number of affected VW vehicles in the jurisdiction, the number of excess NOx tons, the size of the affected population or some combination of those things). NACAA also recommends that every state and local agency that wants to participate should receive a minimum level of funding to recognize the interstate transport of excess emissions and the fact that the affected vehicles may operate in jurisdictions other than where they are sold or registered. NACAA further recommends that state and local air agencies be allowed substantial flexibility in how they structure their programs (e.g., using the funds on their own projects or establishing a competitive grant program similar to the Diesel Emission Reductions Act effort), while ensuring accountability in the use of the funds. The recommendations also include a list of criteria that may be considered when approving projects, such as “a project should generate emission reductions” or “emission reductions should be quantifiable and verifiable.” Finally, the document includes a list – not intended to be exhaustive – of some sample projects that could be funded.

EPA Announces Final Rules on Methane from Oil & Gas Sector

May 12, 2016 – In keeping with President Obama’s Climate Action Plan commitments, EPA released three final rules to reduce emissions of methane, as well as volatile organic compounds (VOCs) and toxic air pollutants, from new, modified and reconstructed sources in the oil and gas sector. The first rule builds on a 2012 regulation under Clean Air Act Section 111(d) to regulate VOC emissions by ratcheting down New Source Performance Standards, making them applicable to methane (which should not require the installation of any additional controls) and expanding the requirements for both pollutants to cover not only hydraulically fractured and refractured natural gas wells but also hydraulically fractured oil wells and additional equipment and activities in the oil and gas production process. The rule also includes requirements for finding and repairing leaks. Among the changes EPA made to the final rule from the proposal are ones setting a fixed schedule for monitoring leaks; allowing an alternative approach (Method 21) for detecting leaks; offering owners/operators the opportunity to use emerging innovative technologies to monitor leaks, subject to EPA approval; and phasing in requirements for using “green completion” to capture emissions from hydraulically fractured oil wells. EPA expects this rule will reduce methane emissions by 510,000 short tons in 2025 and yield climate benefits of $690 million in 2025 as compared to the $530 million estimated cost. The agency anticipates VOC reductions of 210,000 tons and air toxics reductions of 3,900 tons in 2025. The second rule issued by EPA is the Source Determination Rule, which clarifies the agency’s permitting regulations as they apply to the oil and gas sector. In particular, this rule clarifies when oil and gas equipment and activities must be considered a single source, and therefore subject to major source permitting, by deeming equipment and activities under common control and located within a quarter mile of each other as “adjacent.” The third rule establishes a Federal Implementation Plan to implement EPA’s Indian Country Minor New Source Review program for the oil and gas sector, seeking to streamline the preconstruction permitting process. In addition to issuing these three final rules for new sources, EPA also released a draft Information Collection Request (ICR) to gather a broad range of data from facilities to inform the agency’s forthcoming effort to develop regulations to reduce methane emissions from existing oil and gas sources. Once the draft ICR is published in the Federal Register, EPA will accept public comment for 60 days. EPA will then refine the draft ICR and submit it to the Office of Management and Budget, which will publish the second draft ICR for a 30-day public comment period. EPA expects to issue the final ICR in fall 2016 and seek responses by late 2016 and early 2017.

WHO Says Air Pollution Rising in World’s Poorest Areas

May 12, 2016 – The World Health Organization (WHO) announced that its latest urban air quality database—which now covers 3,000 cities in 103 countries—shows that over 80 percent of people living in urban areas that monitor air pollution are exposed to air quality levels that fail to meet the WHO guideline values of 20 μg/m3 for PM10, and 10 μg/m3 for PM2.5. The organization also reported that 98 percent of cities in low- and middle-income countries and with population of over 100,000 people exceed the WHO air quality guidelines compared to 56 percent of cities in high-income countries. WHO compared levels of PM10 and PM2.5 for 795 cities in 67 countries over the period of 2008 to 2013 to identify key trends. The study revealed, among other things, that although some regions have experienced improvements, global urban air pollution levels increased by 8 percent. According to Dr. Maria Neira, Director of the WHO Department of Public Health, Environmental and Social Determinants of Health, “Urban air pollution continues to rise at an alarming rate, wreaking havoc on human health. At the same time, awareness is rising and more cities are monitoring their air quality.” WHO noted that most sources of urban outdoor air pollution are beyond the control of individuals and, instead, require action by cities, countries and international policymakers.

Researchers Report on Prenatal Exposure to PM2.5

April 27, 2016 – Researchers at Johns Hopkins University published a study in which they found exposure to even small amounts of fine particulate matter (PM2.5) appear to increase the risk of intrauterine inflammation (IUI) – a condition in pregnant women that is linked to premature birth and lifelong neurological and respiratory disorders in their children. By studying data from over 5,000 mother-child pairs from a predominantly low-income minority population (the Boston Birth Cohort), the researchers assessed the relationship between IUI and maternal exposure to ambient PM2.5 before and during pregnancy. The researchers say this approach potentially bridges two previously studied relationships: PM2.5 exposure and preterm birth and IUI and preterm birth: “Our findings suggest that IUI may be a sensitive biomarker for assessing early biological effect of PM2.5 exposure on the developing fetus, which may in turn impact subsequent growth, development and health outcomes.” Further, according to lead author Dr. Rebecca Massa Nachman, “This study raises the concern that even current standards for air pollution may not be strict enough to protect the fetus, which may be particularly sensitive to environmental factors. We found biological effects in women exposed to air pollution levels below the EPA standard.” Intrauterine Inflammation and Maternal Exposure to Ambient PM2.5 during Preconception and Specific Periods of Pregnancy: The Boston Birth Cohort was published online in Environmental Health Perspectives.

EPA Proposes Revisions to Regional Haze Rule

April 25, 2016 – EPA proposed revisions to its 1999 regional haze rule, which are intended to "streamline, strengthen, and clarify" various aspects of the program, under which states are required to set goals and emission reduction strategies to improve visibility in federal Class I areas. Among the specific revisions EPA proposes are ones to 1) extend by three years the State Implementation Plan (SIP) submittal deadline for the second regional haze planning period (covering 2019 through 2028) from July 31, 2018 to July 31, 2021 (SIPs for the first planning period, to cover 2008 through 2018, were to have been submitted in 2007); 2) adjust the deadlines for interim progress reports so that the report for the second planning period is due January 31, 2025, the report for the third planning period is due July 31, 2033 and subsequent reports are due every 10 years thereafter; 3) remove the requirement that interim progress reports be in the form of a SIP revision; 4) replace the recurring process of assessing reasonably attributable visibility impairment (RAVI) with an as-needed approach and extend the applicability of RAVI to all states, rather than only those with Class I areas; and 5) require that states consult with Federal Land Managers earlier in the SIP development process. EPA will hold a webinar on the proposal for state, local and tribal air agencies on Wednesday, May 4, 2016. Once the proposal is published in the Federal Register (expected on May 5, 2016), a 60-day public comment period will follow. The agency will hold public hearings on the proposal on May 19, 2016, in Washington, DC and on June 1 or 2, 2016 (TBD) in Denver (the DC hearing is announced in the proposal released by EPA this week; the Denver hearing will be announced in a separate notice).

VW, EPA, CARB Reach “Agreement in Principle”

April 21, 2016 – Presiding over proceedings in the U.S. District Court for the Northern District of California, the Honorable Charles R. Breyer announced that the United States, on behalf of EPA, the California Air Resources Board in conjunction with the California Attorney General’s office, and Volkswagen (VW) have reached an “agreement in principle” to address the approximately 480,000 2.0-liter diesel cars that VW equipped with “defeat devices,” as well as the resulting excess emissions from these vehicles. Under the agreement in principle, consumers will be provided several options: the option to have VW buy back the vehicle; subject to government approval following further testing, the option to have the vehicle modified in accordance with the agreement; and, for those who have leased an affected vehicle, the option to cancel the lease and return the car to VW. Consumers will not have to select an option until there has been an opportunity to fully evaluate all the details and there is nothing for consumers to do at this time; they will receive a formal notice when action is required. The agreement also provides for the payment by VW of “substantial compensation to the consumers” in connection with any of the three options. In addition, according to Judge Breyer, “the agreement will fully address any excess emissions of NOx coming from these vehicles, and the environmental consequences from these excess emissions, by establishing a fund for appropriate remediation efforts. In addition to all these other matters, Volkswagen will be required to commit other funds to promote green automotive technology.” Breyer also noted that none of these terms would become effective “unless and until the parties are able to reduce this to a consent decree, upon which we would then seek public comment at that time.” He then established deadlines for next steps. The United States shall file any consent decree memorializing its agreements with VW on or before June 21, 2016. The plaintiffs shall file a motion for preliminary approval of the settlement of the consumer class action complaint on or before June 21, 2016. The court will hold a hearing on the preliminary approval motion on July 26, 2016. All filings will be public and the public will have an opportunity to fully review and evaluate the proposed agreements before they are approved or acted upon by the court. There will be a status conference on May 19, 2016. Breyer ordered all parties “to continue to keep the contents of the discussions and any proposed agreements confidential until they are filed with the Court.” Finally, he noted, “there are obviously several other issues that I have not discussed this morning. Nor have I addressed them.” Included among these are the approximately 90,000 3.0-liter diesel vehicles equipped with defeat devices, as well as the issues of fines and penalties. Of these, Breyer said, “It is the Court’s expectation that the parties, in addition to finalizing the agreements that I’ve just discussed, will work expeditiously in resolving these outstanding issues.”

EPA Sued for Failure to Regulate Aircraft GHGs

April 12, 2016 – The Center for Biological Diversity (the Center) and Friends of the Earth (FoE) filed a complaint against EPA in the U.S. District Court for the District of Columbia seeking declaratory and injunctive relief for the agency’s alleged unreasonable delay in complying with Section 231 of the Clean Air Act (CAA). Specifically, the plaintiffs contend that EPA has delayed unreasonably 1) issuing an endangerment finding determining that greenhouse gas (GHG) emissions from aircraft engines cause or significantly contribute to air pollution that may reasonably be anticipated to endanger public health and welfare and 2) promulgating regulations to limit such emissions. The Center and FoE petitioned EPA in 2007 to issue an endangerment finding and set emission standards and in 2011 the U.S. District Court for D.C. held that EPA has a compulsory duty to issue an endangerment finding determining whether aircraft GHG emissions cause or contribute to air pollution that may endanger public health and welfare. EPA issued a proposed finding of endangerment in July 2015 but has not yet issued a final action. The plaintiffs now ask the court to 1) declare EPA’s delay in issuing a final determination on endangerment relative to aircraft GHG emissions to be unreasonable and direct EPA to issue such a determination within 30 days following entry of the court’s judgment and 2) declare that if EPA finds that aircraft GHG emissions cause or contribute to air pollution that may reasonably be anticipated to endanger public health and welfare, the agency must initiate a rulemaking under CAA Section 231 to set standards to limit such emissions and propose such standards within 30 days following entry of the court’s judgment.

NACAA Submits Senate Testimony on EPA’s FY 2017 Budget

April 11, 2016 – NACAA provided written testimony to the Senate Appropriations Subcommittee on Interior, Environment, and Related Agencies containing the association’s recommendations related to the proposed FY 2017 budget, including grants to state and local air agencies under Sections 103 and 105 of the Clean Air Act. The President’s proposed budget called for $268.2 million for Sections 103 and 105 grants, which is an increase of $40 million above FY 2016 levels. In the testimony, NACAA supported the increases in the President’s request but recommended that state and local air pollution control agencies be provided with the flexibility to determine how best to use the additional funding. Additionally, NACAA requested that grants for fine particulate matter monitoring remain under Section 103 authority, rather than being shifted to Section 105 authority, as EPA has proposed. NACAA also supported the $1.65-billion “Climate Infrastructure Fund” and resources for the Diesel Emission Reduction Act (DERA) program, which are included in the President’s request. On March 21, 2016, NACAA submitted similar testimony to the House Appropriations Subcommittee on Interior, Environment, and Related Agencies

EPA Announces Details of Allocations of FY 2016 Grant Programs

April 6, 2016 – EPA announced details about two state and local agency grant provisions included in the Consolidated Appropriations Act, 2016, which was adopted on December 18, 2015 and included funding for the federal government for the remainder of the FY 2016 fiscal year (ending September 30, 2016). First, EPA outlined how it will distribute the $21-million Multipurpose Grants to States and Tribes ($20.8 million after the rescission), which Congress included in the final appropriations bill. A total of $19.8 million from the multipurpose grants will be made available to states, local agencies and territories, of which 65 percent ($12.9 million) is specifically set aside “to support core air regulatory work, such as National Ambient Air Quality Standards (NAAQS) implementation, including designations and State Implementation Plans (SIPs), Clean Air Act permitting, and state-led activities to address climate change.” The remaining 35 percent of the $19.8 million will be available for other high-priority activities identified by states. Distribution to states and territories will be based on several factors, including the number of Clean Air Act major source permits and the agency’s share of total EPA categorical grants. The final $1 million is available to tribes for water quality work. Second, pursuant to Congress’s mandate in the appropriations bill that EPA allocate Section 105 grants according to an updated formula, EPA is proposing its allocation of FY 2016 grants to the regions using a revised formula. The new allocation scheme uses a methodology developed in 2010 and relies on updated inputs to account for current population and air quality data. EPA notes that the FY 2016 figures are the first step in a phased process for transitioning from the previous allocation to a more updated formula. Because the fiscal year is half over, however, EPA decided to apply mitigation measures to limit disruption to state and local agency programs. Specifically, regions that were slated to receive additional resources under the revised methodology will receive “modest gains,” while regions calculated to receive less will be held at FY 2015 levels. EPA will take comments on the proposed FY 2016 allocation until April 20, 2016.

NACAA Comments on NODA for Proposed Phase 2 GHG & CAFE Stds

April 1, 2016 – NACAA submitted comments to EPA and the National Highway Traffic Safety Administration on the agencies’ joint Notice of Data Availability (NODA) related to the July 13, 2015 proposed Phase 2 greenhouse gas (GHG) and fuel economy standards for medium- and heavy-duty vehicles and engines. NACAA’s comments on the NODA were in addition to the association’s September 29, 2015 comments on the Phase 2 proposal. In the comments, NACAA focuses on three issues in particular raised in the NODA. First, with respect to a February 19, 2016 EPA memorandum, Additional Discussion of Selective Enforcement Audit and Confirmatory Testing for Aerodynamic Parameters for Combination Tractors and for Trailers, NACAA notes that in the September 2015 comments the association urged EPA “to do everything feasible to implement in-use compliance.” Therefore, NACAA welcomes EPA’s memorandum to provide further insight into enforcement and compliance of the Phase 2 program. Second, with respect to the February 2016 draft EPA Legal Memorandum Discussing Issues Pertaining to Trailers, Glider Vehicles, and Glider Kits under the Clean Air Act, NACAA states its belief that EPA has the environmental obligation to regulate trailers, glider vehicles and glider kits, as well as the legal authority to do so and, in fact, could go even further. Accordingly, NACAA welcomes the agency’s draft legal memorandum providing clarification of the firm legal basis for its proposed actions. Finally, NACAA expresses concern regarding December 28, 2015 comments submitted to the docket by the Specialty Equipment Market Association (SEMA) related to light-duty motor vehicles used for competition racing. In its comments, SEMA takes issue with language in the proposed Phase 2 rule to clarify that certain regulatory provisions related to nonroad vehicles do not, and cannot under the Clean Air Act, apply to onroad vehicles. NACAA believes, however, that SEMA has misconstrued EPA’s intent, existing rules and policy and the Clean Air Act.

NACAA is the national, non-partisan, non-profit association of air pollution control agencies in 40 states, the District of Columbia, four territories and 116 metropolitan areas. The association serves to encourage the exchange of information, to enhance communication and cooperation among federal, state, and local regulatory agencies, and to promote good management of our air resources.